Petition for Writ of Certiorari — Chemical Waste Management, Inc. v. Hunt

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ii f supreme Court, U.S,

61-47; FILED

§u the Supreme Court of the Unite

OCTOBER TERM, 1991

CHEMICAL WASTE MANAGEMENT, INC., PETITIONER

GUY HUNT, GOVERNOR OF THE STATE OF ALABAMA;

ALABAMA DEPARTMENT OF REVENUE; AND

JAMES M. SIZEMORE, Jk., COMMISSIONER OF THE

ALABAMA DEPARTMENT OF REVENUE, RESPONDENTS

Petition for a Writ of Certiorari to the

Supreme Court of Alabama

PETITION FOR A WRIT OF CERTIORARI

JAMES T. BANKS ANDREW J. PINCUS *

JOHN T. VAN GESSEL KENNETH S. GELLER

Chemical Waste EVAN M. TAGER

Management, Inc. Mayer, Brown & Platt

8003 Butterfield Road 2000 Pennsylvania Ave., N.W.

Oak Brook, Illinois 60521 Washington, D.C. 20006

(708) 218-1500 (202) 778-0628

DRAYTON PRUITT, JR. FOURNIER J. GALE III

Pruitt, Pruitt & H. THOMAS WELLS, JR.

Watkins, P.A. Maynard, Cooper, Frierson

Courthouse Square & Gale, P.C.

P.O. Box 1037 1901 Sixth Avenue, North

Livingston, Alabama 35470 2400 AmSouth/Harbert Plaza

(205) 652-9627 Birmingham, Alabama 35203

(205) 254-1000

Counsel for Petitioners

* Counsel of Record

WILSON - EPES PRINTING Co., INC. - 789-0096 - WASHINGTON, D.C. 20001

QUESTIONS PRESENTED

In April 1990, the State of Alabama adopted Act No.

90-326, a statute that taxes and otherwise regulates the

disposal of hazardous waste within Alabama. Petitioner

subsequently commenced this action challenging three pro-

visions of the Act under the Commerce Clause. The ques-

tions presented are:

1. Whether a $72 per ton disposal tax that on its face

applies only to waste generated outside of Alabama vio-

lates the Commerce Clause.

2. Whether a $25.60 per ton disposal tax that applies

only to waste disposed of at “commercial” hazardous

waste disposal facilities, and thereby exempts most of the

hazardous waste generated and disposed of within Ala-

bama, discriminates in its practical effect against out-of-

state waste in violation of the Commerce Clause.

3. Whether a provision limiting the amount of waste

that may be disposed of annually at a commercial hazard-

ous waste disposal facility, which was motivated by an

intention to reduce the amount of out-of-state waste dis-

posed of in Alabama and is structured to achieve that

purpose without substantially limiting the amount of in-

state waste that may be disposed of in Alabama, violates

the Commerce Clause.

(i)

RULE 29.1 STATEMENT

Pursuant to Rule 29.1 of the Rules of this Court, peti-

tioner Chemical Waste Management, Inc., states that its

parent corporation is Waste Management, Inc. Chemical

Waste Management, Inc.’s subsidiaries (other than wholly

owned subsidiaries) are The Brand Companies, Inc. and

Cemtech Management, Inc.

TABLE OF CONTENTS

QUESTIONS PRESENTED ..........0...20..0...0..220-eeeeeeeeee

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TABLE OF AUTHORITIES ........... <>

Teen eo, cescccecsnistnnconeestneenccocees

STATUTORY PROVISIONS INVOLVED |...

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Regulatory Background .......................................--

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Alabama’s Efforts To Impede The Disposal In

Alabama Of Waste Generated In Other States.

The Challenged Statute 000000000... Seen

i ey se, cccnscosecncorsonecorecocses

REASONS FOR GRANTING THE PETITION .........

THE ALABAMA SUPREME COURT'S DECI-

SION UPHOLDING THE FACIALLY DIS-

CRIMINATORY $72 ADDITIONAL FEE

CONFLICTS WITH THIS COURT’S PRECE-

DENTS ON A QUESTION OF GREAT IM-

I tha

A. This Court’s Decisions Make Clear That The

$72 Tax Violates The Commerce Clause ........

B. The Decision Below Squarely Conflicts With

Those Of Other Lower Courts Invalidating

Statutes That Facially Discriminate Against

Out-of-State Waste ............... Sn

(iii)

TABLE OF CONTENTS—Continued

Il. THE ALABAMA SUPREME COURT'S DECI-

Ill.

IV.

SION UPHOLDING THE $25.60 BASE FEE

CONFLICTS WITH DECISIONS OF THIS

COURT AND OTHER COURTS ON RECUR-

RING ISSUES CENTRAL TO THIS COURT’S

COMMERCE CLAUSE JURISPRUDENCE...

A. The Base Fee Discriminates Against Inter-

state Commerce In Violation Of The Com-

merce Clause

B. The Decision Below Exacerbates The Conflict

Among The Lower Courts Regarding The

Circumstances In Which The Strict Scrutiny

Test Should Be Applied To Facially Neutral

State Laws .................

THE ALABAMA SUPREME COURT'S DECI-

SION UPHOLDING THE CAP PROVISION

ALSO WARRANTS REVIEW BY THIS

STITT ennepiesaccihcomsentineesiehiaiiicide eet

THE QUESTIONS PRESENTED HAVE CON-

SIDERABLE PRACTICAL SIGNIFICANCE...

UII sssittsnshiahshionasenitetennecictnnbndiceoniieena

Page

TABLE OF AUTHORITIES

Cases: Page

Alabama vy. United States Environmental Protec-

tion Agency, 871 F.2d 1548 (11th Cir.), cert.

denied, 110 S. Ct. 538 (1989) 000. SE Rot 2,4,5

Amerada Hess Corp. V. Director, Division of Tax-

ation, 490 U.S. 66 (1989) ................2222222..2---20e eee 21, 22

American Trucking Ass’ns, Inc. V. Scheiner, 483

U.S. 266 (1987) ....... Sar et ER Re Rte oe Ae nea 21, 22

American Trucking Ass’ns, Inc. Vv. Secretary of

State, 1991 Me. Lexis 148 (Me. June 17, 1991).. 14

Archer Daniels Midland Co. v. State, 690 P.2d 177

EE TERRES RP RRO i tenn ees A 27

Bacchus Imports, Ltd. v. Dias, 468 U.S. 263

AERP ERE SEE ee 9 ee eR Pee ee NE 20, 22

Best & Co. v. Maxwell, 311 U.S. 454 (1940) 21

Chemical Waste Management, Inc. v. Templet, 1991

U.S. Dist. Lexis 9492 (M.D. La. July 9, 1991). 16

City of Philadelphia v. New Jersey, 437 U.S. 617

eee passim

Commonwealth Edison Co. v. Montana, 453 U.S.

ec sesnnensoienieiacinaiian 23

Continental Illinois Corp. v. Lewis, 827 F.2d 1517

(11th Cir. 1987), vacated as moot, 110 S. Ct.

1249 (1990) ........ BC ar ER POTEET ee ae 25, 26

CTS Corn. v. Dynamics Corp. of America, 481 U.S.

gh SRR TIES OS od Ae nb an ee a aR a .. 28, 24

Dayton Power & Light Co. v. Lindley, 58 Ohio St.

2d 465, 391 N.E.2d 716 (1979) .........0... 26

Division of Alcoholic Beverages & Tobacco v. Mec-

Kesson Corp., 524 So. 2d 1000 (Fla. 1988), rev’d

as to other issues, 110 S. Ct. 2238 (1990) 26, 27

Empire Sanitary Landfill, Inc. v. Pennsylvania,

No. 90-187-W (Pa. Envtl. Hearing Bd.) ........... 17

Exxon Corp. V. Maryland, 437 U.S. 117 (1978) ...... 23, 24

Gilliam County v. Department of Environmental

Quality, No. A68441 (Or. Ct. App.) 0... 17

Government Suppliers Consolidating Services V.

Bayh, 753 F. Supp. 739 (S.D. Ind. 1990) —...... 16

Hardage v. Atkins, 582 F.2d 1264 (10th Cir.

I A IR La ESE anne RIE IG EIEIO ROS ea a Sak 16

TABLE OF AUTHORITIES—Continued

Page

Hazardous Waste Treatment Council v. South

Carolina, 32 E.R.C. 1646 (D.S.C. 1991), appeal

pending, No. 91-2317 (4th Cir.) oD 16, 17

Hughes v. Oklahoma, 441 U.S. 322 (1979)... 11

Hunt Vv. Washington State Apple Advertising

Comm’n, 482 U.S. 388 (1977) ............................. 21, 22

lilinois Vv. General Electric Co., 683 F.2d 206 (7th

Cir. 1982), cert. denied, 461 U.S. 913 (1983) 14, 16, 17

Industrial Maintenance Service Vv. Moore, 677 F.

Supp. 486 (S.D. W. Va. 1987) ............0000 16

J.V. Peters & Co. Vv. Administrator, 767 F.2d 263

I 30

Lewis Vv. Continental Bank Corp., 110 S. Ct. 1249

RAST re a EE A pe Sal rat ae I 25

Maine V. Taylor, 477 U.S. 131 (1986) ee, 13, 14

Maryland v. Louisiana, 451 U.S. 725 (1981) Se ve 15

McKesson Corp. V. Division of Alcoholic Beverages

& Tobacco, 110 S. Ct. 2238 (1990) 20

Minnesota v. Clover Leaf Creamery Co., 449 U.S.

RR TIES ot Ee aR ett ee ae 13, 22

National Solid Wastes Management Ass’n V. Ala-

bama Dep’t of Environmental Management, 910

F.2d 713 (11th Cir. 1990), modified, 924 F.2d

1001, cert. denied, 111 S. Ct. 2800 (1991) — 2,6, 15, 16

National Solid Wastes Management Ass’n V. Jor-

ing, Civ-90-1288A (W.D.N.Y.) 17

National Solid Waste Management Ass’n V. . Voino-

vich, 763 F. Supp. 244 (S.D. Ohio 1991), appeal

pending, No. 91-3466 (6th Cir.) hea 16, 17

New Energy Co. of Indiana vy. Limbach, 486 U.S.

gE eh ER SR ere ee Pe 11,13, 14

Nippert v. City of Richmond, 327 U.S. 416 (1946) . 21

Norfolk Southern Corp. Vv. Oberly, 822 F.2d 388

fe 3D 5 een . 22, 25

Opinion of the Justices, 379 A. 2d 7182 (NH

ROUSE eae 26

Pike v. Bruce Church, Inc., 397 U.S. 137 (1970). x

Robbins v. Shelby County Taxing Dist., 120 US.

489 (1887) AE MR 2 HONE On ON GT Or LST Ta 21

vii

TABLE OF AUTHORITIES—Continued

Page

Washington State Building & Construction Trades

Council v. Spellman, 684 F.2d 627 (9th Cir.

1982), cert. denied, 461 U.S. 913 (1983) ......... 15, 16

Statutes and Regulations:

i GD oo vcrececncesvenccerccscestoneeseonsnsneosones 5

Alabama Act No. 89-788, Section 1(9)-1(14) .......... 17

TA I TI... ci ccnnccoccvssvevensncconsessccscsescees passim

Ala. Code § 28-30-11 (b) ...........-....--2202----0cc0-eeereseeeeee- 6

Ala. Code § 22-30-12(i) ee eee 4

Ala. Code § 22-30B-1(1) —.......... BT aan ik 4

Ala. Code § 22-30B-1(2) ............. a a as ila 19

Ala. Code § 22-30B-1.1 e¢ seq. ............-------------00+-++ 6

BR EN I nanos sececcnscnscccervenvencsnesscnsscesnsstoes 6

Biber, Cte 6 BID... onan nsscenvensecere-covccescocevessvsnesenees 6

Bilin, Celie 6 ID on assoc nncesnccnrcennsessascosessnccsersccnessene 15

Comprehensive Environmental! Response, Compen-

sation and Liability Act, 42 U.S.C. § 9607

Resource Conservation and Recovery Act, 42

USL. GGGG8 a6 006. ..............-.....

42 U.S.C. § 6924 REET EA cares Da iad 7

42 U.S.C. § 6925 ..

Toxic Substances Control Act, 15 US.C. '§ 2601

tht

28 U.S.C. § 1257(a) . is fen: A mata,

Tax Injunction Act, 28 U.S. C, § 1341 ; l

49 U.S.C. App. §§ 1801-1819 -

49 U.S.C. App. § 1805 ...............

Pub. L. No. 101-615, § 23, 104 Stat. 3244 (1990)

40 C.F.R. Parts 260-271 Peas

40 C.F.R. § 264.110-264.120

40 C.F.R. § 264.140-264.147

40 C.F.R. Part 268... se

49 C.F.R. Parts 171-180 (1990) .

49 C.F.R. § 173.300 roan sae

49 C.F.R. § 173.510

49 C.F.R. § 177.834

49 C.F.R. § 177.854-177.860

49 C.F.R. Part 178 .

55 Fed. Reg. 22520 (1990) ......... |

or hr PR RP KRWHOWWN HWW &

Iu the Supreme Court of the United States

OCTOBER TERM, 1991

CHEMICAL WASTE MANAGEMENT, INC., PETITIONER

Vv.

Guy HUNT, GOVERNOR OF THE STATE OF ALABAMA;

ALABAMA DEPARTMENT OF REVENUE: AND

JAMES M. SIZEMORE, JR., COMMISSIONER OF THE

ALABAMA DEPARTMENT OF REVENUE, RESPONDENTS

Petition for a Writ of Certiorari to the

Supreme Court of Alabama

PETITION FOR A WRIT OF CERTIORARI

Chemical Waste Management, Inc., respectfully peti-

tions for a writ of certiorari to review the judgment of

the Supreme Court of Alabama in this case.

OPINIONS BELOW

The opinion of the Supreme Court of Alabama (App.,

infra, la-49a is not yet reported. The opinion of the Cir-

cuit Court of Montgomery County (App., infra, 50a-96a)

is unreported. |

JURISDICTION

The judgments of the Supreme Court of Alabama were

entered on July 11, 1991. App., infra, 97a-10la. The ju-

risdiction of this Court rests on 28 U.S.C. § 1257/(a).

STATUTORY PROVISIONS INVOLVED

Alabama Act No. 90-326 is reprinted at pages 102a-

114a of the appendix to this petition.

STATEMENT

Petitioner Chemical Waste Management, Inc. (“CWM”)

operates a commercial hazardous waste disposal facility

located near the town of Emelle, Alabama (“the Emelle

facility”), that is authorized to treat and dispose of

hazardous waste under both federal and state law. Most

of the waste disposed of at the Emelle facility is generated

in other states and moves in interstate commerce to Ala-

bama for treatment and/or disposal. The facility plays a

critical role in the safe disposal of the Nation’s hazardous

waste. As the United States has observed, “Emelle is

important from a nationwide perspective because it is

the largest hazardous waste management facility in the

United States and the ultimate depository for over one

third of the waste materials shipped off-site from Super-

fund [cleanup] sites.” Brief for the United States at 9,

National Solid Wastes Management Ass’n v. Alabama

Dep’t of Environmental Management (“NSWMA”), 910

F.2d 713 (11th Cir. 1990), modified, 924 F.2d 1001, cert.

denied, 111 S. Ct. 2800 (1991).

For the last three years, the State of Alabama has

tried to prevent the disposal at the Emelle facility of

waste generated in other states. Alabama’s efforts re-

peatedly have been rebuffed by the courts—until now.

The State’s latest assault on non-Alabama waste, Act

No. 90-326, furthers its purpose through three different

provisions: one that facially discriminates against inter-

State waste, one that discriminates in practical effect,

and a third that incorporates both types of discrimina-

tion. Remarkably, the Alabama Supreme Court held that

Act No. 90-326 nonetheless complies with the Commerce

Clause in all respects. This petition seeks review of that

unprecedented interpretation of the Commerce Clause.

1. Regulatory Background. Disposal of hazardous

waste is strictly regulated under federal law. The Re-

source Conservation and Recovery Act (“RCRA”), 42

U.S.C. § 6901 et seq., and the regulations promulgated

by the Environmental Protection Agency (“EPA”) pur-

suant to that statute (see 40 C.F.R. Parts 260-271 ), im-

pose elaborate requirements for the safe handling and

disposal of hazardous waste. See Alabama v. United

States Environmental Protection Agency, 871 F.2d 1548,

1552 (11th Cir.), cert. denied, 110 S. Ct. 538 (1989)

(citations omitted). RCRA provides that all operators of

hazardous waste treatment, storage, or disposal facilities

must obtain permits fixing the terms on which the opera-

tor may engage in those activities. 42 U.S.C. § 6925.

Federal law recognizes that hazardous waste is an un-

avoidable byproduct of virtually all industrial processes

and that some hazardous waste must be disposed of in

landfills. Congress in 1984 specified that land disposal

of hazardous waste would be permitted only after such

waste is treated with the “best available demonstrated

technology,” or in compliance with the applicable treat-

ment standard, in order to reduce the waste’s toxicity

and mobility. 42 U.S.C. § 6924. The EPA has promul-

gated regulations setting forth these technological re-

quirements. See generally 40 C.F.R. Part 268; 55 Fed.

Reg. 22520, 22523 (1990).

Moreover, federal law provides that the operator of a

hazardous waste disposal facility is responsible for en-

suring the containment of waste disposed of at that site. -

40 C.F.R. § 264.110-264.120; see also 42 U.S.C. § 9607.

In addition, the operator must provide “financial assur-

ances’ demonstrating the availability of funds to cover

the closure of the facility and post-closure care for 30

years as well as liability insurance for injuries to third

parties. 40 C.F.R. § 264.140-264.147. Finally, in the

event the foregoing resources prove inadequate, genera-

tors, brokers, and transporters of the waste disposed of

at a hazardous waste disposal facility are jointly and

severally liable for the costs of remedial action if there is

a release from such a facility. 42 U.S.C. § 9607.

Federal law also comprehensively regulates the trans-

portation of hazardous materials. See 49 U.S.C. App.

§§ 1801-1819; 49 C.F.R. Parts 171-180 (1990). Among

other things, these provisions require transporters of

hazardous materials to register with and obtain safety

permits from the Secretary of Transportation (49 U.S.C.

App. § 1805) and specify procedures for minimizing the

risk of and for redressing spills in transit. See 49 C.F.R.

$$ 173.300, 173.510, 177.834, 177.854-177.860; id. Part

178. In addition, federal law requires transporters of

hazardous materials to demonstrate financial respon-

sibility of at least $5 million to cover the cost of re-

mediating any spill of such materials that may occur in

yey Pub. L. No. 101-615, § 23, 104 Stat. 3244, 3272

2. The Emelle Facility. CWM’s Emelle facility has

received a RCRA permit from the EPA, as well as a

separate permit—issued by the EPA pursuant to the

Toxie Substances Control Act, 15 U.S.C. § 2601 et seq.—

authorizing the disposal of polychlorinated biphenyls

(“PCBs”) at the facility.! These permits establish that

the Emelle facility “has complied with elaborate federal

regulations designed to ensure the safe disposal of haz-

ardous wastes * * *. To the extent these federal regula-

tions can and do provide for the safe treatment and

disposal of toxic wastes, CWM’s Emelle, Alabama, fa-

cility poses no threat to the health and safety of the

residents of Emelle or to other Alabama residents.” Ala-

bama, 871 F.2d at 1552-1553. Indeed, Governor Hunt

has characterized the Emelle facility as “probably one

of the safest such facilities in the country.” Pl. Exh. 80.

The Emelle facility is a “commercial” hazardous waste

disposal facility under Alabama law because it is “{a]

site or facility receiving hazardous waste or hazardous

substances * * * not generated on site, for disposal and

to which a fee is paid or other consideration given for

such disposal.” Ala. Code § 22-30B-1(1). A substantial

amount of the waste disposed of at the Emelle facility is

generated in states other than Alabama and moves in

interstate commerce to the Emelle facility. The trial

court found that “|elighty-five to ninety percent of the

1The Emelle facility also is regulated under Alabama law.

Currently, the facility is authorized to operate pursuant to the

interim status procedures set forth in Ala. Code. § 22-30-12(i).

tonnage permanently buried at Emelle is from out-of-

state.” App., infra, 58a.

Hazardous waste is also disposed of within Alabama

at facilities that do not qualify as “commercial,” either

because the waste is generated on site or because a fee

is not charged for disposal. Virtually all of the hazardous

waste disposed of at such facilities is generated within

Alabama. Moreover, this waste accounts for a very sub-

stantial percentage of all of the Alabama-generated waste

that is disposed of within the State.*

3. Alabama’s Efforts To Impede The Disposal In Ala-

bama Of Waste Generated In Other States. Over the past

several years, Alabama repeatedly has sought to prevent

the disposal within the State of hazardous waste gener-

ated in other states. In 1988 the State filed suit in an

effort to halt the cleanup of an abandoned hazardous

waste site in Texas because the waste was to be disposed

of at the Emelle facility. This effort to stop the flow of

waste at the State’s borders was rebuffed by the Eleventh

Circuit. Though dismissing the case on standing and

jurisdictional grounds, that court admonished that “|t]o

the extent plaintiffs * * * assert injury based on the

out-of-state nature of these wastes, the Supreme Court

has already held that the commerce clause bars such a

distinction.” Alabama, 871 F.2d at 1555 n.3.

Alabama’s next attempt to thwart the movement of

waste in interstate commerce was the enactment of Ala.

2In 1987—the most recent year for which data are available

—over 3 million tons of hazardous waste were generated in Ala-

bama. Pl. Exh. 27, at 44. Of that total, less than 30,000 tons were

disposed of in commercial landfills. Robertson Dep. 155-158. About

7,500 tons were disposed of in noncommercial landfills (Pl. Exh.

27, at 62) and 690,000 tons were disposed of in noncommercial

surface impoundments (id. at 64). Another 57,000 tons were

shipped out of state for management and disposal. Jd. at 46.

Over 90% of the remaining 2.2 million tons of in-state waste was

treated or stored in noncommercial surface impoundments and

waste piles. Jd. at 52, 53, 56. Those forms of treatment and stor.

age come within Alabama’s broad definition of “disposal.” See

page 19, infra.

Act No. 89-788 (codified at Ala. Code § 22-30-11(b)) in

May 1989. That measure, popularly known as the Holley

Bill, barred any commercial hazardous waste disposal fa-

cility located in Alabama from treating or disposing of

hazardous waste generated outside Alabama if the state

in which the waste was generated did not satisfy certain

criteria specified by Alabama. Finding that the Holley

Bill “distinguishe|d] among wastes based on their origin

with no other basis for the distinction,” the Eleventh Cir-

cuit held that the Holley Bill violated the Commerce

Clause. NSWMA, 910 F.2d at 720.

4. The Challenged Statute. In 1990, Alabama con-

tinued its assault on out-of-state waste by enacting Ala

Act. No. 90-326 (codified at Ala. Code § 22-30B-1.1 ef

seq.), the statute at issue in this case. The Act imposes

two fees on the disposal of waste at commercial hazardous

waste disposal facilities in Alabama. First, it levies a

fee of $25.60 per ton (“the Base Fee”) on all waste

disposed of at such facilities. Second, the Act imposes a

separate fee of $72 per ton (“the Additional Fee”) ex-

pressly limited to waste generated outside Alabama and

disposed of at such facilities. See Ala. Code § 22-30B-2

The Act also contains a provision that restricts the

amount of waste that can be disposed of at commercial

hazardous waste disposal facilities during any one-year

period (“the Cap Provision”). The cap was fixed at the

amount of waste received at such facilities during the

year beginning July 15, 1990—the day the new fees took

effect. See id. § 22-30B-2.3. The annual limit may be

exceeded if necessary “to protect human health or the

environment in the state, or to allow the state to comply

with its obligations to assure disposal capacity pursuant

to applicable state or federal law.” bid.

When Governor Hunt signed Act No. 90-326 into law

he stated:

On the day I took office just over three years ago

toxic waste producers in other states could drive their

problems to Alabama and dump them for only $6 a

ton. But today, Alabama is taking down the sale

sign. With this law it’s going to cost $112 a ton to

bring hazardous waste into Alabama from other

states. Let the message go out. There are no more

environmental bargains to be found here.

Pl. Exh. 80.* Other state officials made similar pronounce-

ments during the legislature’s consideration of this stat-

ute. See, e.g., Pegues Dep. 32-33 (Director of the Ala-

bama Department of Environmental Management

(“ADEM”) ).

5. The Decisions Below. In May 1990, CWM com-

menced this action in Alabama circuit court challenging

Act No. 90-326 on federal and state constitutional grounds.

Following a trial, the circuit court held that the $72

Additional Fee violated the Commerce Clause, but rejected

CWM’s challenges to the Base Fee and Cap Provision.

The circuit court found that “the Additional Fee fa-

cially discriminates against waste generated in States

other than Alabama * * *. Waste generated within

Alabama * * * is completely exempted from the Addi-

tional Fee.” App., infra, 85a (emphasis in original). The

court rejected the State’s proffered environmental and

safety justifications for singling out waste from other

States:

[H]azardous waste generated in Alabama is just as

dangerous as such waste generated in other states.

All of the safety and environmental concerns set

forth at trial * * * apply with equal force to hazard-

ous waste generated in and out of the State of

Alabama. * * * This Court finds that the record

contains no evidence of any difference between in-

state waste and out-of-state waste other than the

waste’s state of origin.

Id. at 86a.

’ The taxes levied on interstate waste by Act No. 90-326 totalled

$97.60 per ton; other provisions imposed additional exactions

amounting to $14.40 per ton.

The court also concluded that the Additional Fee could

not be justified on the ground that it imposes on out-of-

state waste generators their fair share of the costs to

Alabama of waste disposal facilities located within the

State. The court found insufficient evidence that in-state

generators bore a disproportionate share of these costs

prior to the enactment of the Additional Fee and no evi-

dence that the Fee equalized the burden on in-state and

out-of-state generators. App., infra, 88a n.6. Accordingly,

the court concluded that the Additional Fee violates the

Commerce Clause.

The court reached a different conclusion with respect to

the Base Fee. It began by stating that strict scrutiny is

required under the Commerce Clause only if the chal-

lenged regulation is “discriminatory on its face or in

practical effect.” App., infra, 65a. According to the court,

“any evidence attributing to any state officials any motive

of discrimination against interstate commerce” is “ir-

relevant” to the level of scrutiny required. Jd. at 66a n.1.

The court then stated that the Base Fee does not dis-

criminate against out-of-state waste on its face or in its

practical operation. App., infra, 66a. It therefore upheld

the Base Fee under the balancing test set forth in Pike v.

Bruce Church, Inc., 397 U.S. 137, 142 (1970), concluding

that “the burden the Base Fee imposes on interstate com-

merce is not clearly excessive in relation to the benefits

it produces” (App., infra, 67a).

The circuit court used an identical analysis in assessing

the validity of the Cap Provision. Ignoring the fact that

the exception to the annual limit is available only for

Alabama waste, the court stated that “[t]he Cap provi-

sion applies equally to in-state and out-of-state waste.”

App., infra, 72a. Accordingly, it again applied the Pike

balancing test and upheld the provision.

The Alabama Supreme Court affirmed the circuit court’s

decision—and adopted its opinion—with respect to the

Base Fee and Cap Provision. See App., infra, 17a-37a.

However, it reversed the circuit court’s ruling that the

Additional Fee is unconstitutional. According to the state

supreme court, this Court’s decisions ‘make a distinction

between state measures that discriminate arbitrarily

against out-of-state commerce in order to give in-state

interests a commercial advantage, i.e., simple economic

protectionism, and state measures that seek to protect

public health or safety or the environment.” /d. at 41a.

The court found that the Additional Fee differed from the

facially discriminatory bans on out-of-state waste invali-

dated in City of Philadelphia v. New Jersey, 437 U.S. 617

(1978), and NSWMA because it “has not been enacted for

the purpose of economic protectionism.” Jd. at 44a. Based

on the asserted inapplicability of those decisions, the

court determined that the Additional Fee

serves these legitimate local purposes that cannot be

adequately served by reasonable nondiscriminatory

alternatives: (1) protection of the health and safety

of the citizens of Alabama from toxic substances; (2)

conservation of the environment and the state’s natu-

ral resources; (3) provision for compensatory reve-

nue for the costs and burdens that out-of-state waste

generators impose by dumping their hazardous waste

in Alabama; (4) reduction of the overall flow of

wastes traveling on the state’s highways, which flow

ereates a great risk to the health and safety of the

state’s citizens.

Thie.

The state supreme court concluded that “|t|here is

nothing in the Commerce Clause that compels the State

of Alabama to yield its total capacity for hazardous

waste disposal to other states. To tax Alabama-generated

hazardous waste at the same rate as out-of-state waste

is not an available nondiscriminatory alternative, because

Alabama is bearing a grossly disproportionate share of

the burdens of hazardous waste disposa] for the entire

country.” App., infra, 45a-46a.'

4 Justice Houston concurred in the judgment, concluding that

hazardous waste should not be (reated as an article of commerce

protected by the Commerce Clause. App., infra, 48a-49a,

REASONS FOR GRANTING THE PETITION

The Framers of our Constitution sought to avoid the

commercial rivalries among states that festered under the

Articles of Confederation by mandating economic as well

as political union. The Framers recognized that the states

were in fact economically interdependent and that the

Nation would therefore be strongest without artificial

barriers obstructing commerce among the states. The

Commerce Clause fosters this ideal by prohibiting the

states from discriminating in favor of their own goods

and against those originating in other states and from

seeking to reserve privately-owned resources for their own

citizens.

The statutory provisions at issue here, and the Ala-

bama Supreme Court’s decision upholding them, comprise

nothing less than a frontal assault on these basic Com-

merce Clause principles. The notion that Alabama may in

effect erect an “interstate waste keep out” sign at the

Emelle facility, and reserve CWM’s waste disposal ca-

pacity solely for Alabamians, reflects the very focus on

parochial state interests—rather than national interests—

that the Framers sought to eradicate. This Court should

grant the petition for certiorari to correct the erroneous

decision of the court below and to ensure that the Com-

merce Clause continues to serve its intended function.

I. THE ALABAMA SUPREME COURT’S DECISION

UPHOLDING THE FACIALLY DISCRIMINATORY

$72 ADDITIONAL FEE CONFLICTS WITH THIS

COURT'S PRECEDENTS ON A QUESTION OF

GREAT IMPORTANCE.

The decision below upholding the facially discrimina-

tory $72 tax on interstate waste rests on a clear mis-

application of this Court’s decision in City of Philadel-

phia v. New Jersey, supra, which held that a state may

not discriminate against waste solely on the basis of its

origin. Indeed, the Alabama Supreme Court’s conclusion

that the strictures of the Commerce Clause do not apply

if a state legislature acts for noneconomic reasons was

expressly rejected in City of Philadelphia itself. And

other lower courts have consistently applied the City of

Philadelphia rule regardless of the subjective motivation

underlying the facially discriminatory statute. This

Court should grant review to resolve the conflict among

the lower courts and correct the Alabama Supreme

Court’s error regarding this question of substantial pub-

lie importance.

A. This Court’s Decisions Make Clear That The $72

Tax Violates The Commerce Clause.

Well-established principles govern analysis under the

Commerce Clause of a state law that discriminates on its

face against interstate commerce. Facial discrimination

against interstate commerce “by itself may be a fatal

defect, regardless of the State’s purpose.” Hughes Vv.

Oklahoma, 441 U.S. 322, 337 (1979). To the extent facial

discrimination is not per se unconstitutional, the state’s

burden of justification is “high”: the discriminatory stat-

ute must be invalidated unless the state can show that

the law “advances a legitimate local purpose that cannot

be adequately served by reasonable nondiscriminatory al-

ternatives.” New Energy Co. v. Limbach, 486 U.S. 269,

278 (1988). A court must engage in “the strictest scru-

tiny of any purported legitimate local purpose and of

the absence of nondiscriminatory motives.” Hughes, 441

U.S. at 337.

This Court has applied this standard in the precise

context presented here—a statute that discriminates on its

face against waste generated in other states. In City of

Philadelphia, the Court held invalid under the Commerce

Clause a New Jersey statute that barred the disposal

within that state of waste generated in other states while

permitting disposal of New Jersey waste. The Court ex-

plained that the Commerce Clause prevented New Jersey

from “discriminating against articles of commerce com-

ing from outside the State unless there is some reason,

apart from their origin, te treat them differently.” 437

U.S. at 626-627.

The Court stated that “[t]he harms caused by waste

are said to arise after its disposal in landfill sites, and at

that point, as New Jersey concedes, there is no basis to

distinguish out-of-state waste from domestic waste. If

one is inherently harmful, so is the other. Yet New Jersey

has banned the former while leaving its landfill sites open

to the latter.” 437 U.S. at 629. The statute thus was

“an obvious effort to saddle those outside the State with

the entire burden of slowing the flow of refuse into New

Jersey’s remaining landfill sites. That legislative effort is

clearly impermissible under the Commerce Clause.” Jbid.

The $72 Additional Fee is indistingwishable from the

statute held invalid in City of Philadelphia: it discrimi-

nates against out-of-state waste precisely because of the

waste’s state of origin. There can be no dispute that the

purpose and effect of the Additional Fee are to discourage

the disposal within Alabama of waste generated in other

states, while exempting from that burden waste gen-

erated within Alabama. That is precisely what City of

Philadelphia forbids.

The Alabama Supreme Court refused to apply City of

Philadelphia’s anti-discrimination principle to the Addi-

tional Fee. It reasoned: “City of Philadelphia v. New

Jersey does not hold that a state may not limit importa-

tion of wastes to protect health and the environment; it

holds that a state may not do so for ‘simple economic pro-

tectionism.’”” App., infra, 42a.

This Court’s decisions, however, expressly and con-

clusively reject the Alabama Supreme Court’s “distinc-

tion’ based on subjective legislative motivation. For

example, in City of Philadelphia itself, New Jersey

“denlied|] that [its statute] was motivated by financial

concerns or economic protectionism” and contended that

it was designed “ ‘to protect the health, safety and wel-

fare of the citizenry at large.’” 437 U.S. at 626 (citation

omitted). The Court found New Jersey’s actual motive

irrelevant, stating:

[I]t does not matter whether the ultimate aim of

[the statute| is to reduce the waste disposal costs of

New Jersey residents or to save remaining open

lands from pollution, for we assume New Jersey has

every right to protect its residents’ pocketbooks as

well as their environment. * * * But whatever New

Jersey’s ultimate purpose, it may not be accomplished

by discriminating against articles of commerce com-

ing from outside the State unless there is some

reason, apart from their origin, to treat them dif-

ferently.

Id. at 626-627. The Court has reiterated this point on

several occasions. See, e.g., New Energy, 486 U.S. at 279

n.3 (even if state legislature was motivated by a sub-

jective purpose to protect public health, that purpose was

“inadequate to validate patent discrimination against in-

terstate commerce’); Maine v. Taylor, 477 U.S. 131, 148-

149 n.19 (1986) (the City of Philadelphia standard ap-

plies “not only to laws motivated solely by a desire to

protect local industries from out-of-state competition, but

also to laws that respond to legitimate local concerns by

discriminating arbitrarily against interstate trade”).°

Thus, the decision below simply cannot be reconciled with

City of Philadelphia.

The Alabama Supreme Court’s unjustifiably narrow un-

derstanding of City of Philadelphia’s nondiscrimination

principle incurably infects its conclusion (App., infra,

44a) that the Additional Fee promotes four legitimate

purposes that could not be adequately served through less

discriminatory means. To begin with, because the circuit

court found (and the state supreme court did not dispute)

that “hazardous waste generated in Alabama is just as

dangerous as such waste generated in other states” (id. at

5 The Alabama Supreme Court stated (App., infra, 42a) that

Minnesota v. Clover Leaf Creamery Co., 449 U.S. 456 (1981),

supported its reading of City of Philadelphia. In fact, that deci-

sion reaffirmed City of Philadelphio’s conclusion that “[a] court

may find that a state law constitutes ‘economic protectionism’ on

proof either of discriminatory effect or of discriminatory pur-

pose.” 449 U.S. at 471 & n.15 (citation omitted; emphasis added).

86a), the State’s health and safety justification plainly

can be served as well—if not better—by a nondiscrimina-

tory per-ton tax applicable to all waste disposed of within

Alabama. City of Philadelphia, 437 U.S. at 629; accord

New Energy Co., 486 U.S. at 279.°

Alabama’s goal of conserving landfill space also may

be achieved through an even-handed tax on all landfilled

waste regardless of origin. See City of Philadelphia, 437

U.S. at 627 (“a State may not accord its own inhabitants

a preferred right of access over consumers in other States

to natural resources located within its borders’). Simi-

larly, Alabama’s concern about transportation risks can

be addressed as well or better by means of a nondiscrimi-

natory tax on the transportation of hazardous materials

on Alabama roads. See American Trucking Ass’ns, Inc. V.

Secretary of State, 1991 Me. Lexis 148 (Me. June 17,

1991); /ilinois v. General Electric Co., 683 F.2d 206, 214

(7th Cir. 1982), cert. denied, 461 U.S. 913 (1983).

Finally, it is undisputed that any costs and burdens that

Alabama might be forced to incur some time in the fu-

*The court below relied (App., infra, 43a-44a) on Maine v.

Taylor, supra, which involved a Maine statute that banned the

importation of out-of-state baitfish. This Court measured the con-

stitutionality of the statute under the strict scrutiny standard

applicable to laws that discriminate against interstate commerce.

It upheld the statute only because Maine had “legitimate reasons,

‘apart from their origin, to treat [out-of-state baitfish] differ-

ently.’” Jd. at 152 (quoting City of Philadelphia, 437 U.S. at 627).

The out-of-state baitfish had a physical characteristic—the pres-

ence of a parasite—that was “not common to wild fish in Maine”

and, in addition, shipments of out-of-state baitfish could include

non-Maine species that “could disturb Maine’s aquatic ecology to

an unpredictable extent.” 477 U.S. at 141. The State proved that

no measure short of a complete ban would allow the State effec-

tively to protect its delicate ecological balance. Taylor thus rested

squarely on this Court’s determination that the record in that

case established that out-of-state baitfish were in fact different

from and posed a substantially different threat to the environment

than in-state baitfish. Taylor is inapplicable here because there is

no such difference between a ton of Alabama waste and a ton of

waste generated in other states.

ture as a result of a ton of hazardous waste that is disposed

of today will not vary depending on the waste’s state of

origin. See Tr. 364 (testimony of ADEM official Sue

Robertson). Accordingly, the State’s desire to provide a

financial safeguard against the assertedly uncertain fu-

ture costs and burdens associated with the present disposal

of hazardous waste—to the extent such a safeguard is

necessary or even appropriate given the federal protec-

tions already in place (see pages 2-5, supra)—plainly can

be satisfied through nondiscriminatory taxation or regu-

lation of all hazardous waste disposed of in Alabama.‘

In sum, the unconstitutionality of the Additional Fee

is clear under this Court’s settled Commerce Clause juris-

prudence.

B. The Decision Below Squarely Conflicts With Those

Of Other Lower Courts Invalidating Statutes That

Facially Discriminate Against Out-of-State Waste.

The Alabama Supreme Court’s decision creates a square

conflict among the lower courts concerning the constitu-

tionality of state statutes that facially discriminate against

waste generated out-of-state. Prior to the decision below,

four federal courts of appeals, relying on City of Phila-

delphia, had held such statutes invalid under the Com-

merce Clause. See NSWMA, supra; Washington State

Building & Construction Trades Council v. Spellman, 684

7In fact, the Additional Fee does not provide a safeguard of

any kind because the revenues are not set aside in an environmental

emergency fund, but instead are “deposited into the general bud-

getary fund of the state to be used for general operations * * *.”

Ala. Code § 22-30B-3.

Moreover, to the extent the court below believed that the Addi-

tional Fee compensated for other taxes paid by in-state generators

of hazardous waste, it erred by failing to analyze the fee under the

“compensatory tax” doctrine. This Court has made clear that the

doctrine applies only if the tax on interstate activity merely coun-

terbalances a “substantially equivalent” tax on intrastate activity.

See, e.g., Maryland v. Louisiana, 451 U.S. 725, 759 (1981). Aiabama

never has identified a tax that falls exclusively on in-state waste and

is “substantially equivalent” to the Additional Fee.

F.2d 627 (9th Cir. 1982), cert. denied, 461 U.S. 913

(1983) ; General Electric Co., 683 F.2d at 213-214; Hard-

age V. Atkins, 582 F.2d 1264, 1266 (10th Cir. 1978).*

The reasoning employed by the Alabama Supreme Court

is directly contrary to these decisions. For example, the

Eleventh Circuit concluded in NSWMA that absent proof

that out-of-state waste differs from waste generated in

Alabama “on the basis of type of waste or degree of

dangerousness,” Alabama could not subject out-of-state

waste to stricter regulation. 910 F.2d at 721. See also

Spellman, 684 F.2d at 631 (“[t]he State of Washington

neglects to address * * * the manner in which local waste,

transported and stored within Washington has superior

safety and environmental] virtues over waste produced else-

where and similarly controlled by state regulatory meas-

ures”). The circuit court applied the same standard in

the present case. App., infra, 85a-86a. The Alabama

Supreme Court, on the other hand, upheld the facially dis-

criminatory statute even though it did not dispute the

circuit court’s finding that there was no qualitative dis-

tinction between waste generated within Alabama and

waste generated in other states.

Moreover, these federal courts have applied City of

Philadelphia without regard to subjective motivation un-

derlying the discriminatory statute. Indeed, the Eleventh

Circuit expressly concluded in NSWMA that the statute

there at issue was an “honorable and well intentioned”

attempt to “com{e| to grips with environmental prob-

lems” (910 F.2d at 725), but nonetheless struck it down

*A number of federal district courts have reached the same

conclusion. See Chemical Waste Management, Inc. v. Templet, 1991

U.S. Dist. Lexis 9492 (M.D. La. July 9, 1991); National Solid

Waste Management Ass'n V. Voinovich, 763 F. Supp. 244 (S.D.

Ohio 1991), appeal pending, No. 91-3466 (6th Cir.); Hazardous

Waste Treatment Council Vv. South Carolina, 32 E.R.C. 1646 (D.S.C.

1991), appeal pending, No. 91-2317 (4th Cir.); Government Sup-

pliers Consolidating Servs. Vv. Bayh, 753 F. Supp. 739 (S.D. Ind.

1990); Industrial Maintenance Serv. V. Moore, 677 F. Supp. 436

(S.D. W. Va. 1987).

under City of Philadelphia, Id. at 721.° Accord General

Electric Co., 683 F.2d at 213. The Alabama Supreme

Court’s decision thus conflicts with the cited court of ap-

peals decisions in approach as well as in result.

The conflict between the Alabama Supreme Court and

the Eleventh Circuit is particularly unacceptable because

of the effects of the Tax Injunction Act, 28 U.S.C. § 1341,

which requires that most challenges to tax statutes be

brought in state court. As a result of the Alabama Su-

preme Court’s anomalous decision, one Commerce Clause

standard will apply to Alabama’s non-tax measures, which

may be challenged in federal court, while a conflicting rule

will apply to discriminatory Alabama taxes, which may

be challenged only in state court. The Court should grant

certiorari to eliminate this double standard.

Finally, review is warranted because this issue arises

with considerable frequency. A number of states have

adopted laws and regulations that facially discriminate

against interstate commerce in waste; Commerce Clause

challenges are currently pending against the laws and

regulations of six such states. National Solid Waste

Management Ass’n V. Voinovich, supra; Hazardous Waste

Treatment Council v. South Carolina, supra; National

Solid Wastes Management Ass’n V. Jorling, Civ-90-1288A

(W.D.N.Y.); Empire Sanitary Landfill, Inc. v. Pennsyl-

vania, No. 90-187-W (Pa. Envtl. Hearing Bd.) ; Gilliam

County Vv. Department of Environmental Quality, No.

A68441 (Or. Ct. App.). The decision below could affect

the resolution of these cases and might prompt additional

states to enact discriminatory barriers to the interstate

*The Alabama Supreme Court suggested (App., infra, 40a-41a)

that the Eleventh Circuit’s decision was distinguishable because the

Additional Fee “has specifically been found by the legislature to be

an effective way to deal with health and environmental hazards to

Alabamians created by hazardous waste imported here from other

states.” In fact, however, the legislative findings accompanying the

statute invalidated by the Eleventh Circuit clearly reflect the very

same concerns that motivated Act No. 90-326. See Alabama Act

No. 89-788, Section 1(9)-1(14).

movement of waste. This Court should grant certiorari

and reaffirm that the Commerce Clause prohibits this

kind of discriminatory legislation.

Il. THE ALABAMA SUPREME COURT’S DECISION

UPHOLDING THE $25.60 BASE FEE CONFLICTS

WITH DECISIONS OF THIS COURT AND OTHER

COURTS ON RECURRING ISSUES CENTRAL TO

THIS COURT’S COMMERCE CLAUSE JURISPRU-

DENCE.

Alabama did not rely solely on express discrimination

against interstate commerce to achieve its goal of ob-

structing the disposal of out-of-state waste in Alabama.

The $25.60 per ton Base Fee—though facially neutral—

also furthers the State’s discriminatory plan.

The Base Fee applies only to waste disposed of at

“commercial” hazardous waste disposal facilities; it ex-

empts waste disposed of at all other facilities—i.e., facili-

ties that dispose of waste generated on site or that do

not charge a disposal fee. It is undisputed that essen-

tially all out-of-state hazardous waste shipped to Alabama

for disposal is disposed of at a commercial hazardous

waste disposal facility (principally the Emelle facility)

and therefore is subject to the Base Fee. At the same

time, virtually all of the hazardous waste that is disposed

of at other disposal facilities—and hence is exempt from

the Base Fee—is generated within Alabama. This exempt

waste makes up most of the Alabama-generated hazard-

ous waste disposed of within the State. See page 5 &

n.2, supra.

By carving out a substantial exemption from the tax

that, as a practical matter, is available only to Alabama-

generated waste, Alabama has succeeded in applying the

tax to virtually all interstate waste disposed of within

the State, but to only a small percentage of Alabama-

generated waste. The use of “commercial” as a proxy for

“out-of-state” thus ensures that the economic burden of

the tax is borne disproportionately by interstate com-

merce.

Certainly there is nothing inherent in the nature of a

waste disposal tax that justifies the distinction that Ala-

bama has drawn. Act No. 90-326 taxes “disposal,” which

it defines broadly as:

[t]he discharge, deposit, injection, dumping, spilling,

incineration, leaking or placing of any waste or sub-

stance into or on any land or water so that such

waste or substance or any constituent thereof may

enter the environment or be emitted into the air or

discharged into any waters including groundwaters

* * *

Ala. Code § 22-30B-1(2). This definition encompasses the

landfilling of hazardous waste, as well as certain forms of

treatment or storage—e.y., methods utilizing surface im-

poundments or waste piles. The definition thus recognizes

that it is the character of the waste and the means by

which it is disposed of, treated, or stored—not the type of

facility at which these management activities take place

—that is relevant to the State’s putative health and safety

purposes. Those purposes would be implicated equally by

every single ton of hazardous waste “discharge|d], de-

positted] * * * or placfed]” on land or water in Ala-

bama regardless of whether the facility doing so is “com-

mercial.” '"° Targeting “commercial” facilities alone serves

no purpose other than conferring an advantage on politi-

cally powerful in-state generators of hazardous waste."

10 Indeed, witnesses for both sides testified that the Emelle

facility is better designed, and generally less likely to cause harm

to public health or the environment, than the facilities not covered

by the tax. Tr. 396 (Robertson); Henson Dep. 66; Brumond Dep.

279-281.

11The Alabama Supreme Court, in rejecting CWM’s equal pro-

tection challenge to the Base Fee, offered several justifications for

the distinction between “commercial” facilities and other facilities.

Principally, it asserted that the distinction is justified by the risk

inherent in the transportation of waste. App, infra, 23a-24u. But

the tax does not single out waste that is transported in Alabama:

waste generated on-site at the Emelle facility is taxed even though

it is not transported, while waste transported for disposal at other

This is not the first time that a case has reached

this Court involving a state statute crafted on the basis

of industry characteristics that serve as proxies for dis-

tinguishing interstate commerce from intrastate com-

merce. In McKesson Corp. v. Division of Alcoholic

Beverages & Tobacco, 110 S. Ct. 2238 (1990), Flor-

ida had first enacted a tax statute expressly exempt-

ing beverages made from “Florida-grown” crops. After

this Court struck down a similar statute in Bacchus

Imports, Ltd. yv. Dias, 468 U.S. 263 (1984), the State sub-

stituted a law that deleted the references to “Florida-

grown” and “replaced them with special rate reductions

for certain specified citrus, grape, and sugarcane prod-

ucts, all of which are commonly grown in Florida and used

in alcoholic beverages produced there.” 110 S. Ct. at 2243

(footnote omitted). The statute no longer facially dis-

criminated against interstate commerce, but—because the

specified beverages were produced disproportionately

within Florida and therefore served as a proxy for intra-

state commerce—-it discriminated just as_ effectively

against interstate commerce in its practical operation.

The Florida Supreme Court held that the statute there-

fore violated the Commerce Clause. That holding was

not disputed before this Court, which observed that the

Florida Supreme Court’s decision “rested on established

principles of Commerce Clause jurisprudence.” Jd. at

2247 n.15.

facilities is not taxed (as long as no disposal fee is charged).

The court also stated (ibid.) that commercial facilities pose special

problems because they accumulate greater amounts of waste than

other facilities. Yet a per-ton tax on waste already takes this

asserted fact fully into account. Finally, the court observed (id. at

24a) that the State need not treat commercial and noncommercial

activities the same for tax purposes. While that observation may

be true as a general matter, it is irrelevant where the taxed ac-

tivity is disposal, not sales. In any event, even if any of the

court’s justifications for the State’s distinction suffices to meet

the lenient rational basis test applied under the Equal Protection

Clause, all plainly fall far short of justifying discrimination

against interstate commerce.

The Base Fee has a discriminatory effect that is in-

distinguishable from that of the statute struck down in

McKesson. The Alabama Supreme Court’s decision up-

holding the Base Fee in spite of that effect thus conflicts

with McKesson (as well as the decisions of several other

state and federal courts) and diverges sharply from this

Court’s precedents. Review of that decision is plainly

warranted.

A. The Base Fee Discriminates Against Interstate Com-

merce In Violation Of The Commerce Clause.

1. This Court has made clear on numerous occasions

that a state law must be assessed under the strict stand-

ard applicable to facially discriminatory statutes if it

discriminates against interstate commerce in its practical

operation. See, e.g., Amerada Hess Corp. V. Director, Di-

vision of Taxation, 490 U.S, 66, 75, 76 (1989) ; American

Trucking Ass’ns, Inc. Vv. Scheiner, 483 U.S. 266, 286

(1987); Hunt v. Washington State Apple Advertis-

ing Comm’n, 432 U.S. 333, 350-353 (1977); Nippert v.

City of Richmond, 327 U.S. 416, 431 (1946); Best & Co.

v. Maxwell, 311 U.S. 454, 456 (1940). The fact that the

law might be facially neutral is not dispositive of the con-

stitutional inquiry because “|t]|he commerce clause forbids

discrimination, whether forthright or ingenious.” Best &

Co., 311 U.S. at 455.

Thus, the Court has condemned facially neutral statutes

that effect “ingenious” discrimination in a multitude of

contexts. For example, it repeatedly has struck down

facially neutral taxes on persons soliciting orders for

merchandise. Such taxes, as a practica] matter, fall more

heavily on out-of-state businesses, which, unlike their

local competitors, may find it economically infeasible to

maintain a regular retail outlet in the taxing jurisdiction

and therefore have to employ solicitors to reach customers

there. See, e.g., Nippert, supra; Robbins v. Shelby County

Taxing Dist., 120 U.S. 489 (1887). The Court also has

invalidated flat truck taxes because the effect of such

taxes is to impose a heavier per-mile cost on trucks

engaged in interstate operations than on trucks engaged

in intrastate operations. See Scheiner, 483 U.S. at 284-

256. And it has struck down a requirement that apples

bear the applicable federal grade rather than a state

grade because the effect of that requirement was to

eliminate the competitive advantage enjoyed by producers

of apples from other states with stricter grading systems.

Hunt, 432 U.S. at 351-352.

As we have discussed (see page 18, supra), the Base

Fee is gerrymandered to reach virtually all interstate

commerce, while exempting as much intrastate commerce

as possible. That discriminatory effect requires that the

constitutionality of the Base Fee be determined under

the strict scrutiny test.

Any doubt about the necessity of strict scrutiny review

here is eliminated by the strong evidence of the State’s

discriminatory intent. As the Third Circuit has observed,

it May sometimes be difficult to determine whether a fa-

cially neutral statute that imposes disproportionate bur-

dens on interstate commerce should be analyzed under the

strict scrutiny test or the Pike balancing test. Where

there is evidence of discriminatory motive and discrimina-

tory effect, however, there can be no doubt that strict

scrutiny is warranted. Norfolk Southern Corp. v. Oberly,

S22 F.2d 388, 400-401 & n.18 (3d Cir. 1987). In Hunt,

for example, this Court discussed evidence of the State’s

discriminatory motive to bolster its conclusion that the

statute discriminated in effect against interstate com-

merce (432 U.S. at 352).

Here, there is abundant evidence of discriminatory in-

tent. The entire purpose of Act No. 90-326 was to ob-

struct interstate commerce in waste. See pages 6-7, supra.

'? Indeed, this Court repeatedly has stated that evidence that a

law was motivated by an intent to discriminate against inter-

state commerce is by itself sufficient to trigger strict scrutiny

under the Commerce Clause. See, e¢.g., Amerada Hess, 490 US.

at 75, 76; Bacchus Imports, 468 U.S. at 270: Clover Leaf Creamery

449 U.S. at 471 n.15. .

In view of the clear evidence of both discriminatory effect

and discriminatory intent, there can be no doubt that the

Base Fee discriminates against interstate commerce in

violation of the Commerce Clause."*

2. The Alabama Supreme Court’s contrary conclusion

rests on a misunderstanding of this Court’s precedents.

The Alabama court stated that CWM had failed to estab-

lish a discriminatory effect because “|t|he mere fact

* * * that most of its customers are out-of-state gen-

erators does not establish discrimination against inter-

state commerce.” App., infra, 19a (citing C7T'S Corp. V.

Dynamics Corp. of America, 481 U.S, 69 (1987); Com-

monwealth Edison Co. v. Montana, 453 U.S. 609 (1981) ;

and Exxon Corp. Vv. Maryland, 4837 U.S. 117 (1978)).

But we rely on more than the identity of our customers.

We contended below and argue before this Court that the

Base Fee has a discriminatory effect because it was care-

fully drafted to include virtually all interstate hazardous

waste disposed of within Alabama and exclude virtually

all Alabama hazardous waste. The express exemption of

noncommercial hazardous waste facilities thus has the

practical effect of shifting a disproportionate tax burden

to interstate commerce.

Certainly the cases cited by the Alabama Supreme

Court do not support its refusal to apply strict scrutiny.

In Commonwealth Edison, the challenged coal severance

tax applied evenhandedly to all coal mined in Montana,

regardless of the coal’s ultimate destination; coal] mined

for use in-state was not exempted from the tax. Out-of-

state users thus bore the burden of the tax in exact

proportion to the amount of coal they used. Accordingly,

this Court held, “there |was]| no real discrimination” re-

quiring application of strict scrutiny. 453 U.S. at 619.

13 For the reasons discussed above in connection with the Addi-

tional Fee, the Base Fee does not further a legitimate purpose

that cannot be served adequately by nondiscriminatory means. The

State could accomplish its purposes through an across-the-board

per-ton tax on all hazardous waste disposed of or transported in

Alabama.

See also CTS Corp., 481 U.S. at 87 (Indiana’s facially

neutral anti-takeover statute did not discriminate against

interstate commerce in its practical operation because it

“ha{d| the same effects on tender offers whether or not

the offeror |was] a domiciliary or resident of Indiana’) ."*

If the Base Fee applied to all hazardous waste dis-

posed of in Alabama and if CWM’s claim merely were

that most hazardous waste disposed of in Alabama (and

hence subject to the fee) is from out of state, this case

would be similar to CTS and Commonwealth Edison. But

the Base Fee does not apply to a// hazardous waste dis-

posed of in Alabama; instead it has been carefully drawn

to apply only to waste disposed of at commercial hazardous

waste disposal facilities, with the result that, as a prac-

tical matter, it applies almost exclusively to out-of-state

waste. Surely if Montana had exempted “noncommercial”

coal mines from the severance tax and if it turned out

that virtually all of the coal from such mines was used

within Montana, the Court would have found that the

severance tax discriminated against interstate commerce

in its practical effect.

Indeed, under the Alabama Supreme Court’s apparent

view that statutory exemptions are irrelevant in deter-

4 Exxon Corp., supra, is even less apposite. That case involved

a Maryland statute that barred petroleum refiners and producers

from operating retail service stations within the state. The plain-

tiffs argued that the statute discriminated against interstate com-

merce because there were no Maryland-based refiners or producers.

The Court rejected the argument, reasoning that while the statute

prevented some interstate companies—i.e., the refiners and pro-

ducers—from operating service stations, it did not bar other inter-

state companies—those not engaged in refining and producing—

from participating in the Maryland retail market. Because the

statute did not discriminate against all interstate operators—it did

not apply to the “several major interstate marketers of petroleum

that own and operate their own retail gasoline stations [in Mary-

land |”—the statute did not discriminate in its practical operation.

437 U.S. at 125-126. Here, by contrast, Alabama has imposed the

Base Fee on virtually all out-of-state waste, while exempting a

large percentage of in-state waste.

mining whether a tax discriminates against interstate

commerce in its practical effect, the statute in McKesson

should have been upheld on the ground that it taxed all

alcoholic beverages other than those few categories ex-

empted in the statute. The fact that all of the exempt

beverages were produced in Florida would have been ir-

relevant. That narrow view of discrimination against

interstate commerce flies in the face of this Court’s

precedents.

B. The Decision Below Exacerbates The Conflict

Among The Lower Courts Regarding The Circum-

stances In Which The Strict Scrutiny Test Should

Be Applied To Facially Neutral State Laws.

The issue presented by the Alabama Supreme Court’s

decision regarding the Base Fee—when should a facially

neutral statute be held to discriminate against interstate

commerce—is an important question on which the lower

courts are in conflict. This Court should grant certiorari

to provide guidance regarding this issue.

To begin with, the role of evidence of discriminatory

motive is a matter urgently requiring clarification. Such

evidence has been held relevant in shedding light on the

practical effect of a facially neutral statute. Continental

Illinois Corp. Vv. Lewis, 827 F.2d 1517, 1521-1523 (11th

Cir. 1987), vacated as moot, 110 S. Ct. 1249 (1990);

Oberly, 822 F.2d at 400-401 n.18."° The Alabama Supreme

Court has now taken the diametrically opposite view, hold-

ing such evidence “irrelevant.” App., infra, 19a-20a n.2.

The role of intent evidence is of course an issue that

can arise in every Commerce Clause case and, for that

reason, clear guidance for the lower courts is essential.

This Court heard argument on the proper role of such

evidence in Lewis v. Continental Bank Corp., 110

S. Ct. 1249 (1990), but did not reach the question because

subsequent federal legislation rendered the case moot.

This case represents an opportunity to resolve that im-

portant issue.

15 This Court has even stated that evidence of such a motive by

itself triggers strict scrutiny review. See page 22 n.12, supra.

Second, the decision below exacerbates a conflict regard-

ing the standards for ascertaining whether a facially

neutra! statute discriminates against interstate commerce

in its practical effect. Several lower courts have followed

this Court’s lead and invalidated facially neutral statutes

structured so as to impose a disproportionate burden on

interstate commerce. For example, the Ohio Supreme

Court applied this rationale to strike down a coal use tax

whose rate varied inversely with the sulphur content of

the coal. Finding that virtually all Ohio coal had a high

sulphur content, while a significant amount of coal from

nearby states had:a low sulphur content, the Ohio Supreme

Court concluded that the tax scheme discriminated against

out-of-state coal in its practical operation. Dayton Power

& Light Co. v. Lindley, 58 Ohio St. 2d 465, 391 N.E.2d

716 (1979).

The Florida Supreme Court utilized the same approach

in McKesson, striking down the facially neutral liquor

tax because, as noted above (at 20), it contained an

exemption that disproportionately benefitted in-state

products at the expense of out-of-state products. Di-

vision of Alcoholic Beverages & Tobacco v. McKesson

Corp., 524 So. 2d 1000, 1008 (Fla. 1988), rev’d as

to other issues, 110 S. Ct. 2238 (1990). See also Con-

tinental Illinois Corp., 827 F.2d at 1522 (invalidating

a Florida law banning new industrial savings banks be-

cause the effect of that law was to foreclose the only

means that out-of-state bank holding companies had to

compete for Florida deposits without disturbing the alter-

natives that were available only to in-state bank holding

companies) ; Opinion of the Justices, 379 A.2d 782, 789

(N.H. 1977) (explaining, in an advisory opinion on the

constitutionality of a proposed tax on operators of oil

terminal facilities with storage capacities in excess of 500

barrels, that “[t]he line drawn at 500 barrels might have

the effect of discriminating against interstate commerce if

that line differentiates domestic from foreign corpora-

tions”).

In contrast, the Colorado Supreme Court, like the Ala-

bama Supreme Court, has refused to apply strict scru-

tiny notwithstanding a showing that the statute at issue

disproportionately benefitted intrastate commerce, See

Archer Daniels Midland Co. v. State, 690 P.2d 177 (Colo.

1984). At issue in Archer Daniels was a 5¢ per gallon

sales tax reduction for gasohol that was availabie only for

gasohol produced at facilities with an annual production

capacity of 17 million gallons or less. The record reflected

that no Colorado producer had an annual production ca-

pacity of over 17 million gallons, whereas over ( of

the national market was excluded by the capacity limita-

tion. Jd. at 192 (Lohr, J., dissenting). Despite this

severely disproportionate impact, the closely-divided Colo-

rado Supreme Court upheld the tax reduction provision

under the Pike balancing test. The court’s decision con-

flicts with the other decisions cited above. Indeed, the

Florida Supreme Court expressly refused to follow it in

McKesson, See 524 So. 2d at 1007.

In sum, the lower courts are plainly in need of guid-

ance in determining when to apply strict scrutiny to

facially neutral statutes. This Court should grant certi-

orari to address that question.

Il. THE ALABAMA SUPREME COURT’S DECISION

UPHOLDING THE CAP PROVISION ALSO WAR-

RANTS REVIEW BY THIS COURT.

The Alabama Supreme Court refused to subject the

Cap Provision to strict scrutiny, stating: “Tonnage re-

strictions which apply equally to all waste, regardless of

origin, do not violate the Commerce Clause.” App., infra,

26a. The court’s conclusion that the Cap Provision does

not discriminate against interstate commerce—and _ its

ultimate decision upholding that provision—are tied to its

decisions upholding the Additional Fee and Base Fee and

merit review for much the same reasons.

To begin with, invalidation of either of the taxes on

Commerce Clause grounds would necessitate invalidation

of the Cap Provision. See App., infra, 92a-93a (trial

court decision). The cap would be tainted because the

amount was fixed at a time when the disposal volume was

severely and improperly depressed by the illegal taxes.

The cap itself also independently discriminates against

interstate commerce. To begin with, the Alabama Supreme

Court’s basic premise—-that the Cap Provision is facially

neutral—is plainly wrong. The provision contains an ex-

ception that permits disposal of additional waste if neces-

sary either to protect human health or the environment in

the State or to meet Alabama’s federal obligation to assure

sufficient capacity to dispose of Alabama-generated waste.

By its very terms, therefore, this condition can be satis-

fied only if there is a need to dispose of Alabama-

generated waste. Thus, through this facially discrimina-

tory exception, the State has ensured that the compara-

tively smal! percentage of in-state waste disposed of at

the Emelle facility never actually will be subject to the

annual limit that out-of-state waste must face.

Like the Base Fee, moreover, the Cap Provision applies

only to “commercial” disposal facilities and therefore

discriminates against interstate commerce in its prac-

tical effect. By imposing the cap only on commer-

cial hazardous waste facilities that disposed of over

100,000 tons of hazardous waste from July 15, 1990

through July 14, 1991, the State artfully has ensured

that the annual limit will apply only to the Emelle fa-

cility. Because the Emelle facility disposes of virtually

all of the hazardous waste that is brought to Alabama

from other states, the annual limit will serve to limit the

amount of out-of-state waste that can be disposed of at

the Kmelle facility in any one year, while allowing the

overwhelming majority of in-state waste—the waste that

is disposed of at other facilities—to escape any limit

whatever.

The record also contains considerable evidence that the

Cap Provision, like Act No. 90-326 as a whole, was

motivated by an intent to discourage the disposal of out-

of-state waste in Alabama. For example, when Governor

Hunt signed Act No. 90-326 into law, he stated: “An im-

portant” provision in this bill will cap the amount of

hazardous waste that can be dumped in Alabama at

whatever amount is brought to the state over the next

12 months.” Pl. Exh. 80. See also Pegues Dep. 50-51,

61-62. As explained with regard to the Base Fee ( at

22), this supports the conclusion that the Cap Provision

is unconstitutionally discriminatory.

IV. THE QUESTIONS PRESENTED HAVE CONSIDER-

ABLE PRACTICAL SIGNIFICANCE.

The constitutionality under the Commerce Clause of

state laws that discriminate against out-of-state waste Is

a question of tremendous practical importance. ( /W M's

payments for the first year the two fees have been in

effect totaled approximately $34 million. And the dis-

criminatory burdens on interstate commerce have di-

verted a substantial amount of interstate commerce away

from the Emelle facility and Alabama. The volume of

waste disposed of at CWM’s Emelle facility has dropped

by more than 50% in the year since Act No, 90-326 took

effect. Out-of-state waste accounts for virtually all of the

decline. This devastating blow to interstate commerce in

general—and to CWM’s business in particular —is made

permanent by the Cap Provision.

The threat to interstate commerce involves more than

just money. The Emelle facility plays a critical role in

the safe disposal of the Nation’s hazardous waste. As the

circuit court found, “Emelle received two years ago ap-

proximately 17% of all hazardous wastes commercially

landfilled in the United States.” App., infra, 58a. There

are only five commercial hazardous waste landfills east

of the Mississippi River, and only two of those are per-

mitted to accept waste containing PCBs. Tr. 170 (testi-

mony of Rodger Henson) ; 250 (Robertson). Interstate

transportation of such waste is therefore unavoidable if

the waste is to be disposed of in facilities that comply

with the governing federal standards. See, ¢.g., Tr. 82

(Henson) ; 215-216 (Robertson).

This is especially true with respect to the considerable

amount of waste disposed of at F'melle that has been re-

moved from unsafe disposal sites, as a result of either

16 At the time of the trial, only one landfill east of the Mississippi

River could accept PCBs.

voluntary efforts or cleanups under federal and state

“Superfund” programs. Virtually all of that waste

comes from outside Alabama. See Tr. 55, 160 (Hen-

son); 210-212 (Robertson). The significant increase

in cost resulting from the Additional and Base Fees,

and the permanent annual limit effectuated by the

Cap Provision, will almost certainly deter cleanup

efforts, thus prolonging the grave threat that these

unregulated, unsafe sites pose to the public at large.

That result will undermine Congress’s primary pur-

pose in enacting the Superfund statute: “ ‘the prompt

cleanup of hazardous waste sites.’ ” J.V. Peters & Co.

Vv. Administrator, 767 F.2d 263, 264 (6th Cir. 1985)

(citation omitted). By raising a significant barrier to

the disposal of out-of-state waste at the Emelle facility,

which provides a significant part of the Nation’s overall

waste disposal capacity, Act No. 90-326 thwarts the im-

portant public goal of safely disposing of this waste.

CONCLUSION

The petition for a writ of certiorari should be granted.

Respectfully submitted.

JAMES T. BANKS ANDREW J. PINCUS *

JOHN T. VAN GESSEL KENNETH S. GELLER

Chemical Waste EVAN M. TAGER

Management, Inc. Mayer, Brown & Platt

3003 Butterfield Road 2000 Pennsylvania Ave., N.W.

Oak Brook, Illinois 60521 Washington, D.C. 20006

(708) 218-1500 (202) 778-0628

DRAYTON PRUITT, JR. FOURNIER J. GALE III

Pruitt, Pruitt & H. THOMAS WELLS, Jr.

Watkins, P.A. Maynard, Cooper, Frierson

Courthouse Square & Gale, P.C.

P.O. Box 1037 1901 Sixth Avenue, North

Livingston, Alaboma 35470 24004 mSouth/Harbert Plaza

(205) 652-9627 Birmingham, Alabama 35202

(205) 254-1000

Counsel for Petitioners

SEPTEMBER 1991 * Counsel of Record

APPENDICES

APPENDIX A

SUPREME COURT OF ALABAMA

SPECIAL TERM, 1991

1901043

Guy Hunt, as Governor of the State of Alabama

Vv.

CHEMICAL WASTE MANAGEMENT, INC.

1901044

JAMES M. SIZEMORE, JR., as Commissioner of the

Alabama Department of Revenue; and the

ALABAMA DEPARTMENT OF REVENUE

CHEMICAL WASTE MANAGEMENT, INC.

1901106

CHEMICAL WASTE MANAGEMENT, INC.

THE ALABAMA DEPARTMENT OF REVENUE, et al.

Appeals from Montgomery Circuit Court

(CV-90-1098)

SHORES, JUSTICE.

In April 1990, the Alabama Legislature enacted Act

No. 90-326 (the “Act”), effective July 15, 1990, Code of

Ala, 1975, § 22-30B-1 et seq. (Supp. 1990), which was

signed into law by the Governor. The Act imposes two

fees on the disposal of hazardous waste at commercial

facilities in Alabama. A “Base Fee” of $25.60 per ton

was imposed on all waste and substances disposed of at

commercial facilities, regardless of the state of origin.

An “Additional Fee” of $72.00 per ton was imposed on

all waste and substances generated outside the State of

Alabama and disposed of at Alabama facilities.

The Act also included a “Cap” provision, limiting the

amount of hazardous waste that can be disposed of at

any affected facility in any one-year period. Under the

Cap provision, the amount of hazardous waste disposed

of during the first year that the Act’s new fees are in

effect (the “benchmark period”), becomes the permanent

ceiling in subsequent years. The Cap provision applies

only to commercial facilities that dispose of over 100,000

tons of waste per year. The facility at Emelle, Alabama,

is the only facility in this category. 4

On June 5, 1990, Chemical Waste Management, Inc.

(“CWM”), filed suit for declaratory relief against the

Alabama Department of Revenue, James N. Sizemore, Jr.,

as Commissioner, and Guy Hunt as Governor (“the

State”). The suit challenged the constitutionality of Act

No. 90-326, Code of Alabama 1975, § 22-30B-1 et seq.

CWM alleged that the provisions of the Act violate the

Commerce Clause of the United States Constitution; the

Equal Protection Clause of the United States Constitu-

tion and its equivalents under the State Constitution; and

the Due Process Clause of the State Constitution. CWM

further contends that the Act is a “revenue bill” enacted

during the last five days of the legislative session in vio-

lation of Article IV, § 70, of the Alabama Constitution.

CWM further contends that the Cap provision violates

the Commerce, Due Process, and Equal Protection Clauses

of the United States Constitution and is preempted by

various federal statutes.’

CWM also sought a preliminary and permanent injune-

tion enjoining the State from enforcing, applying, or

attempting to enforce the Act. Dr. Claude Earl Fox,

state health officer, was allowed to intervene on behalf of

the State Board of Health.

Governor Hunt filed a counterclaim for declaratory

relief, asking that the trial court find and declare the

Act constitutional. On February 28, 1991, the trial

judge, the Honorable Joseph D. Phelps, declared the Base

Fee and Cap provisions of the Act to be valid and con-

stitutional. However, he declared the Additional Fee im-

posed on out-of-state generated waste to be impermissible

and invalid as a violation of the Commerce Clause of the

United States Constitution.

The State appeals only that aspect of the trial judge’s

order pertaining to the Additional Fee. CWM appeals

from the trial judge’s holding that the Base Fee and Cap

are constitutional. We affirm the trial judge’s holdings

that the Base Fee and Cap provisions of the Act are valid

and constitutional. We reverse the holding of the trial

judge that the Additional Fee violates the Commerce

Clause.

The legislative findings underlying Act No. 90-326, as

quoted by the trial judge in his order of February 28,

1991, are as follows:

1(1) the Resource Conservation and Recovery Act (“RCRA”),

42 U.S.C. $6901 et seq.; (2) the Toxic Substances Control Act

(“TSCA”), 15 U.S.C. $2601 et seq.; (3) the Comprehensive En-

vironmental Response Compensation and Liability Act (“CERCLA”),

42 U.S.C. § 9601 et seq.

“Act § 1, Code § 22-30B-1.1 Legisiative findings.

“The Legislature finds that:

“(1) The state is increasingly becoming the nation’s

final burial ground for the disposal of hazardous

wastes and materials;

(2) The volumes of hazardous wastes and sub-

stances disposed in the state have increased dra-

matically for the past several years;

“(3) The existence of hazardous waste disposal ac-

tivities in the state poses unique and continuing

problems for the state;

“(4) As the site for the ultimate burial of hazardous

wastes and substances, the state incurs a permanent

risk to. the health of its people and the maintenance

of its natural resources that is avoided by other

states which ship their wastes to Alabama for dis-

posal ;

“(5) The state also incurs other substantial costs

related to hazardous waste management including

the costs of regulation of transportation, spill clean-

up and disposal of ever increasing volumes of haz-

ardous wastes and substances;

“(6) Because all waste and substances disposed at

commercial sites for the disposal of hazardous waste

and hazardous substances, whether or not such waste

and substances are herein defined as hazardous, con-

tribute to the continuing problems created for the

state, and because state and federal definitions of

‘hazardous wastes’ have regularly changed and are

likely to change in the future to include waste not

previously defined as hazardous, it is necessary that

all waste and substances disposed of at a commercial

site for the disposal of hazardous waste or hazardous

substances be included within the requirements of

this act;

“(7) The legislature finds that the public policy of

the state is to encourage business and industry to

develop technology that will eliminate the generation

of hazardous waste and substances... .

“(8) Since hazardous wastes and substances gener-

ated in the state compose a small proportion of those

materials disposed of at commercial disposal sites

located in the state, present circumstances result in

the state’s citizens paying a disproportionate share

of the costs of regulation of hazardous waste trans-

portation, spill cleanup and commercial disposal

facilities. Persons, firms or corporations which gen-

erate and dispose of such waste and substances in

Alabama presently are among the taxpaying citizens

of this state who must bear the burden of regulation,

inspection, control and clean-up of hazardous waste

sites; addressing the public health problems created

by the presence of such facilities in the state; and,

preserving this state’s environment while those gen-

erating this waste in other states and shipping it to

Alabama for disposal presently are not. This act

attempts to resolve that inequity by requiring all

generators of waste being disposed of in Alabama to

share in that. financial burden.

“(9) The operators of commercial sites for the dis-

posal of hazardous wastes or hazardous substances

have the ability to control the flow of said wastes or

substances into said sites. Further, said operators,

by exercise of said ability to control the flow of

wastes or substances disposed at sites during a

twelve-month period [need] only to enlarge the

amount of wastes disposed during the next- tweilve-

month period by a proportionate amount. The health

of the population of this state and the soundness of

the environment are and would be threatened by such

an exercise of control. Said exercise of control could

cause an artificial decrease in fees during the twelve

month period beginning July 15, 1990, and ending

July 14, 1991. To prevent threats to the health of

the population of this state and to the soundness of

the environment of this state and to prevent an arti-

ficial decrease in fees during the twelve-month period

beginning July 15, 1990, and ending July 14, 1991,

this act provides a cap on the amount of hazardous

waste and hazardous substances disposed during the

twelve-month period beginning October 1, 1991, said

cap being a function of the amount of hazardous

waste and hazardous substances disposed during the

twelve-month period beginning July 15, 1990, and

ending July 14, 1991.”

The pertinent provisions of Act No. 90-326 are as

follows:

Act § 3(a), Code § 22-30B-2(a) (the Base Fee):

“In addition to other fees levied, there is hereby lev-

ied a fee to be paid by the operators of each com-

mercial site for the disposal of hazardous waste, or

hazardous substances in the amount of $25.60 per

ton for all waste or substances disposed of at such

site.”

Act §3(b), Code § 22-80B-2(b) (The Additional

Fee):

“For waste and substances which are generated out-

side of Alabama and disposed of at commercial sites

for the disposal of hazardous waste or hazardous

substances in Alabama, an additional fee shall be

levied at the rate of $72.00 per ton.”

Act § 9, Code § 22-30B-2.3 (the Cap Provision):

“Any commercial site for the disposal of hazardous

waste or hazardous substances that disposes of in

excess of 100,000 tons of hazardous waste or hazard-

ous substances during the twelve-month period begin-

ning July 15, 1990, and ending July 14, 1991, (here-

—_

inafter referred to as the benchmark period ) shall

not, during any twelve-month period beginning Cc-

tober 1, 1991, and any twelve-month period there-

after, dispose of more than the tonnage received dur-

ing said benchmark period. Such restriction shall be

in addition to any other ban or restrictions on dis-

posal imposed by any regulatory authority. Provided,

however, that the Governor or the Governor’s des-

ignee may allow disposal of hazardous wastes or

hazardous substances in excess of the tonnage dis-

posed of during the benchmark period if such action

is determined by the Governor or the Governor's

designee to be necessary to protect human health or

the environment in the state, or to allow the state to

comply with its obligations to assure disposal capac-

ity pursuant to applicable state or federal Jaw as

determined by the Governor or his designee.

Act § 2, Code § 22-30B-1 (Definitions):

“(3) HAZARDOUS SUBSTANCE(S). Any sub

stunce defined as a hazardous substance pursuant to

42 U.S.C. §9601(14), as amended, or listed as a

hazardous waste pursuant to the Code of Alabama

1975, Section 22-30-10, as amended.

“(4) HAZARDOUS WASTE(S). Those wastes de-

fined at Section 22-30-3(5), Code of Alabama 1975,

as amended, or listed pursuant to Section 22-30-10,

Code of Alabama 1975, as amended, or department

regulations.”

The trial judge made findings of fact in his order of

February 28, 1991, which we quote below and approve:

“BINDINGS OF FACT

“1. Based on statements and representations made

by the parties during pretrial proceedings, the Court

accepts the legislative findings supporting Act No.

90-326. In addition, the Court finds that the evidence

at trial adequately supports the legislative findings.

The Court further finds that the Base Fee and Cap

provisions of Act No. 99-326 which this Court deter-

mines and finds to be constitutionally permissible are

integral parts of a regulatory procedure which ap-

propriately addresses the concerns expressed by the

Alabama Legislature when it enacted the ‘Hazardous

Wastes Management Act of 1978,’ The following

statement of Legislative Finding, Purpose and Intent

is set forth in this 1978 legislation:

“Section 2. Legislative Finding, Purpose and In-

tent—The Legislature finds that increasing quanti-

ties of hazardous wastes are being generated in the

State and that without adequate safeguards from the

point of generation through handling, processing and

final disposition, such wastes can create conditions

which threaten human or animal health and the en-

vironment. The Legislature, therefore, declares that

in order to minimize and control any such hazardous

conditions it is in the public interest to establish and

to maintain a statewide program to provide for the

safe management of hazardous wastes.’

“Acts 1978, 2nd Ex.Sess., No. 129, p. 1843.

“A. The Emelle Facility

“2. CWM is a Delaware corporation with its prin-

cipal place of business in Oak Brook, Illinois. CWM

is the owner and operator of one of the nation’s old-

est and largest commercial hazardous waste land dis-

posal facilities located in Emelle, Alabama (the

‘Emelle facility’). The Emelle facility is a hazardous

waste treatment, storage, and disposal facility oper-

ating pursuant to a permit issued by the Environ-

mental Protection Agency (‘EPA’) under the Re-

source Conservation and Recovery Act, 42 U.S.C.

$ 6901 et seg. (‘RCRA’) and the Toxic Substances

Control Act, 15 U.S.C. § 2601 et seq. (‘TSCA’). In

addition, the Emelle facility is a to > sero

r state law pursuant to interim status author!

yee under freemen Code § 22-30-12 (i). The

Emelie facility is the only commercial hazardous

waste landfill facility currently in operation in the

State of Alabama.

“3 In a 1973 study, EPA identified 74 potential

sites for hazardous waste landfills throughout the

country, of which Emelle was one. Although haz-

ardous waste landfills can be designed and engineered

to operate in practically every state of the United

States, only a very few commercial sites presently

exist. Efforts to obtain permits for new sites in other

states are resisted by citizens of those states.

“4. According to the testimony presented at trial,

only one additional hazardous waste landfill has been

permitted in the United States since the effective date

of RCRA, Noveniber 17, 1980. That facility, in Last

Chance, Colorado, has never operated or accepted

waste and is presently for sale.

“RB. The Increasing Volumes of

Out-of-State Wastes at Emelle

“5. Increasing amounts of out-of-state hazardous

wastes are being shipped to Emelle for permanent

storage from in-state generators and from those in

states throughout the country. The following ton-

nage has been received by Emelle in the years indi-

cated:

_ ere rerrr rte reer... 341,000 tons

Re eee eer eee a 2 456,000 tons

aon re errr car rs > 564,000 tons

oe kee eee eRe eae 549,000 tons

en eke eke eee sree euns 788,000 tons

10a

“The increase in tonnage has resulted in a significant

increase in problems with regard to regulating and

supervising the disposal of hazardous waste at

Emelle. Eighty-five to ninety percent of the tonnage

permanently buried at Emelle is from out-of-state.

Emelle received two years ago approximately 17% of

all hazardous wastes commercially landfilled in the

United States.

“6. CWM estimates there is capacity at Emelle

for another 100 years of operation. CWM has a*-

mitted that without the restrictions imposed by the

Alabama legislature, ‘the total annual demand for

disposal capacity at the Emelle facility for hazardous

waste generated out-of-state is projected to increase

annually.’ (Paragraph D of Answer of CWM to

Defendant Hunt’s Counterclaim.)

“7. A portion of the wastes coming to Emelle

are classified as non-hazardous. Some of these non-

hazardous industrial wastes are sent to the Emelle

facility by industries which may be seeking to reduce

their own liability should these wastes become classi-

fied as hazardous wastes in the future. Additionally,

these non-hazardous wastes are commingled with the

hazardous wastes that are landfilled at the Emelle

facility and therefore for the purposes of long-range

monitoring and potential cleanup, must be treated as

hazardous waste in any event. EPA, moreover, has

made limited progress in identifying hazardous

wastes to be regulated and does not know whether

it has identified 10% or 90% of existing hazardous

wastes. As a result, wastes which today are deemed

non-hazardous may very well in the future be deemed

hazardous for one reason or another.

lla

“C. The Permanent Risks and Costs

of Hazardous Waste Landfilling

“8. It is without dispute that the wastes and sub-

stances being landfilled at the Emelle facility include

substances that are inherently dangerous to human

health and safety and to the environment. Such

waste consists of ignitable, corrosive, toxic and re-

active wastes which contain poisonous and cancer

causing chemicals and which can cause birth defects,

genetic damage, blindness, crippling and death.

Should a sudden or non-sudden discharge or release

occur, hazardous wastes could pollute the environ-

ment, contaminate drinking water supplies, con-

taminate the ground water, and enter the food chain.

Among these are arsenic, mercury, lead, chromium

and cyanide. These wastes are generated by an en-

tire spectrum of industry.

“9. Landfilling is the least desirable means of

hazardous waste disposal. Many hazardous wastes

remain in the environment and do not break down.

Although some wastes degrade or can be made less

hazardous through treatment, many substances re-

main hazardous forever.

“10. Aithough hazardous wastes are now required

to be solidified before being placed in a landfill, seep-

age of groundwater and surface water into closed

trenches at Emelle containing liquid or solidified

wastes creates a poisonous liquid known as leachate.

Scientists are continuing to learn more about leach-

ate and water pressures. As concluded in the August,

1983 report to CWM by Golder Associates, the ac-

cumulation of leachate in closed trenches will result

in a ‘vertical head difference serv/ing] as the driv-

ing force which will eventually cause exfiltration of

fluid within the landfill trenches outward into the

surrounding chalk.’ The testimony at trial was that

12a

it appears that leakage has already occurred with

respect to at least some of the closed trenches.

Leachate is presently pumped only from closed

Trench 19 and open Trench 21. It is stored in above

ground storage tanks with a capacity of 5 million

gallons. From 10 million to 15 million gallons an-

nually of leachate and surface water are gathered,

stored and transported from Emelle at a cost of

$2 to $3 million.

“11. EPA has found that absolute prevention of

migration of hazardous waste through synthetic

trench liners is beyond the current technical state

of the art, and that some migration will occur. The

liners will probably retard migration only for the

relatively short-term measured in tens of years. Al-

though it appears that leachate is already seeping

into the Selma chalk, it is uncertain how far it has

moved and at what rate it will travel. There are

widely varying estimates as to travel time. A No

vember, 1987 joint report of the hazardous waste

Ground-Water Task Force of EPA and the Alabama

Department of | Environmental Management

(‘ADEM’) entitled ‘Evaluation of Chemical Waste

Management, Inc., Emelle, Alabama’, stated at page

30 as follows:

“‘The transit time through the Selma chalk

(“to the Eutaw Formation ... uppermost aqui-

fer”) was estimated by CWM to be 10,000

years. Independent EPA estimates of transit

time using conservative estimate for equation

variable were 330 years and 3,000 years for

estimates using Darcy’s Equation and a 2-D

solute transport model, respectively... .’

“Those transit time estimates all involve compli-

cated calculations based upon highly variable factors.

13a

“12. The evidence shows that possibly a more

serious concern is the lateral migration of leachate

from the trenches following the downward gradient

to the drainage areas leading to Bodka Creek, a

tributary of the nearby Noxubee and Tombighbee

Rivers. Although the closed trenches studied by

Golder Associates in an August, 1990 report range

from 50 to 150 feet apart, a CWM expert witness

testified it would surprise him if there-were a migra-

tion of finid from some of the closed trenches to other

closed trenches; that there probably is some inter-

connection between those trench walls; and that fluid

could move along the near surface defects in the

downgradient direction.

“13. The Selma Group Chalk Formation, in which

the Emelle facility is located, extends across the

states of Alabama, Mississippi, Arkansas and Texas.

Although the chalk generally is of low permeability

and is potentially suitable for the geological contain-

ment of hazardous wastes, the geologic integrity of

the chalk also depends on the permeability of frac-

tures, faults and other discontinuities. Faults and

fractures exist throughout the Selma chalk at Emelle

through which the leakage of hazardous waste and

leachate may be greatly facilitated. Dr. Richard Gro-

shong, a geology professor at the University of Ala-

bama, testified that the faults and fractures may

accelerate travel time through the Selma chalk by

several orders of magnitude. According to Dr.

Groshong, these rates ‘are important on a human

time scale as opposed to a geological time scale.’

Tom Joiner, a former State Geologist, agreed that a

‘brittle fault’ might speed the migration of leachate

through the Selma chalk.

“14. Dr. Groshong testified that there is a further

need to identify, map, and study the faults and frac-

tures at the Emelle facility. However, there will

l4a

always be uncertainty with respect to the faults and

fractures.

“15. To monitor leachate and hazardous waste

leakage, CWM has been required to install a large

number of monitoring wells at Emelle. Periodic

checks of those monitoring wells will be required for-

ever. One CWM witness estimated the present annual

costs of that monitoring system is between $100,000

and $200,000. Another CWM official estimated moni-

toring costs of Emelle to be in excess of $114 million

per year. It is doubtful that monitoring wells can

be placed in sufficient locations to monitor all the

movement of water as such monitoring may prove to

be impractical. Thus, the uncertainty of whether

all contamination will be detected will likely remain.

Indeed, the existence of monitoring wells creates new

conduits for hazardous wastes to reach underlying

groundwater.

“16. The Emelle facility is within an earthquake

risk zone as designated by the Alabama Emergency

Management Agency. There was testimony to the

effect that earthquakes pose an uncertain short and

long range risk to the Emelle facility. In 1886 an

earthquake in Sumter County caused a one-half foot

movement in the ground surface. There was evi-

dence that, depending upon its severity, an earth-

quake could unseal cracks in the chalks and open

avenues for the movement of leachate and hazardous

wastes.

“D. Transportation and Spills

“17. In 1989, approximately 40,000 truckloads of

wastes were transported over the public highways to

the Emelle facility of which approximately 34,000 to

36,000 were from out of state. As in the operation

of the facility, transportation of these wastes, no

matter how elaborate the precautions, also creates

l5da

unquantifiable risk or uncertainty to the public

health and to the environment.

“Some trucks destined for Emelle have been in-

volved in accidents causing hazardous waste to be

spilled or released into the environment. Addition-

ally, several incidents of releases of hazardous wastes

and noxious fumes have already occurred at the fa-

cility. These risks are increased by the increasing

volumes. The hazardous wastes landfilled at the

Emelle facility are inherently dangerous in their

transportation and movement into or from one place

to another throughout the State of Alabama. That

movement into and through the State of Alabama

carries the potential and risk of spills, accidents and

explosions that could release toxic fumes and con-

taminate the groundwater and/or surface water.

The increasing volumes have increased the risks and

liability involved in that transportation.

“E. Permanence of Dangers and Financial Risks

“18. Although it will be necessary to monitor,

regulate, maintain (including the pumping, collec-

tion, storage, transportation and disposal of leachate

from the trenches), and secure the facility forever,

CWM has made no provision for the payment of

such costs beyond a period of 30 years after closure.

Additionally, there has been no provision for the pay-

ment of any abatement, corrective, or remediation

costs, compliance monitoring, third-party damages

or natural resource damage.

“19. Whenever CWM’s planned or unplanned ces-

sation of activities at Emelle occurs, there will be

substantial financial and environmental risks to the

people, businesses, and corporations of Alabama.

“20. Alabama has a legitimate interest in guard-

ing against the various imperfectly understood en-

l6a

vironmental risks posed by the storage of large

quantities of hazardous wastes in Alabama, as well

as the risks which may be more easily identified.

“F. The Legislative Classifications

“91. The CWM hazardous waste facility at

Emelle currently is the only commercial hazardous

waste landfill in Alabama. Of the 788,000 tons of

waste landfilled at Emelle during 1989, 68,000 to

69,000 tons were generated in-state, or 8.6% of the

1989 total.

“92. There is only one, relatively small non-com-

mercial hazardous waste landfill facility presently

permitted for hazardous waste in Alabama. It is in

Washington County, and it accepts only on-site gen-

erated hazardous waste of approximately 4000 tons

a year.

“23. Closed non-commercial hazardous waste land-

fills (such as Sanders Lead in Troy) are not com-

parable to Emelle. They only- accepted on-site gen-

erated hazardous waste and are no longer in oper-

ation.

“24. Non-commercial hazardous waste facilities

are not comparable to commercial hazardous waste

facilities. Commercial facilities are likely to involve

the transportation of wastes from off-site locations,

and the accumulation and disposal of relatively large

quantities of hazardous wastes; most non-commercial

facilities dispose of wastes on-site, and generally do

not involve transportation. The amounts generated

and disposed of at non-commercial facilities are far

smaller than amounts disposed of at commercial fa-

cilities. Accordingly, the~ public health and safety

risks associated with commercial hazardous waste

facilities are much greater than those associated

with non-commercial facilities.

17a

“25. Incinerators are not comparable to commer-

cial hazardous waste landfills. Incinerators perma-

nently destroy hazardous waste, leaving only a small

residue which must be landfilled.

“26. Should additional commercial hazardous

waste landfills be permitted in Alabama, and meet

the statutory criteria, the provisions of Act 90-326

would apply to them just as they apply now to

CWM.”

We first consider whether the trial court erred in

holding that the Base Fee of Act No. 90-326 is consti-

tutional. CWM contends the trial court erred in finding

the Base Fee constitutional and. argues that it clearly

discriminates against interstate commerce in violation

of the Commerce Clause. CWM argues further that the

Base Fee violates the Equal Protection Clause, because,

it claims, the classifications are not rationally related to

a legitimate state interest. CWM finally argues that the

Base Fee violates the Due Process Clause.

We do not find CWM’s arguments as to this issue to

be persuasive. We adopt the conclusions of law stated

by Judge Phelps in his order of February 28, 1991, as

the decision of this Court as to this issue:

“The Base Fee

“(1) The Commerce Clause Challenge

“As a threshold matter, the Court concludes that

the Base Fee regulates evenhandedly and without

regard to origin. The Base Fee effectuates a legiti-

mate local interest. The legisiature found, among

other things, that: the volume of hazardous wastes

being disposed of in Alabama has increased dra-

matically; the state incurs a permanent risk to the

health of its people and the maintenance of its na-

tural resources; and Alabama incurs substantial eco-

18a

nomic costs related to hazardous waste management

such as regulatory costs and spill cleanup. Addi-

tionally, the evidence at trial documented specific

possible threats to human health and the environ-

ment posed by the Emelle facility. Clearly, the state

of Alabama has a legitimate interest in imposing

fees on commercial hazardous waste facilities to

address the serious financial, environmental and

other risks they create.

“It is well-settled that states’ regulatory powers

are greatest when they address traditional matters

of local concern such as environmental and natural

resource regulation. Kassel v. Consolidated Freight-

ways, 450 U.S. 662, 670, 101 S.Ct. 1309, 67 L.Ed.2d

580, 586 (1981). Legislative measures enacted to

promote public health and safety are accorded par-

ticular deference. Raymond Motor Transportation,

Inc. v. Rise, 484 U.S. 429, 443, 98 S.Ct. 787, 54

L.Ed.2d 664, 676 (1978). Challenges to state public

safety regulations must overcome a ‘strong presump-

tion of their validity.’ Id., 434 U.S. at 444, 98 S.Ct.

at 795, 54 L.Ed.2d at 677. Courts will not second-

guess legislative judgments about the importance of

safety justifications in comparison with the burdens

on interstate commerce. Kassel, 450 U.S. at 670,

67 L.Ed.2d at 587. States retain broad authority

under their general police powers to regulate matters

of legitimate local concern even though interstate

commerce is affected. Maine v. Taylor, 477 U.S. 131,

138 (1986).

“When a police power regulation is challenged un-

der the Commerce Clause, one of two tests is ap-

plied. If the regulation is discriminatory on its face

or in practical effect, the state must show that (1)

the regulation has a legitimate local purpose; (2)

the regulation serves this interest; and (3) reason-

able nondiscriminatory alternatives, adequate to pre-

19a

serve the legitimate local purpose, are not available.

Hughes v. Oklahoma, 441 U.S. 322, 336 (1979).

This is the ‘strict scrutiny’ test.

“If no facial discrimination is involved, a ‘balanc-

ing test’ is applied to determine the constitutional

validity of statutes:

““*Where the statute regulates evenhandedly to

effectuate a legitimate local public interest, and

its effects on interstate commerce are only in-

cidental, it will be upheld unless the burden im-

posed on such commerce is clearly excessive in

relation to the putative local benefits.’

Pike v. Bruce Church, 397 U.S. 137, 90 S.Ct. 844, 25

L.Ed.2d 174 (1970). If a legitimate local purpose

exists, ‘the extent of the burden that will be toler-

ated will of course depend on the nature of the local

interest involved, and on whether it could be pro-

moted as well with a lesser impact on interstate ac-

tivities.’ Jd.

“CWM has failed to establish that the Base Fee

has discriminatory effects on interstate commerce.

The mere fact, as CWM argues, that most of its

customers are out-of-state generators does not estab-

lish discrimination against interstate commerce. The

United States Supreme Court has stated that even

if the burden of a state regulation falls most often

on out-of-state companies, this burden ‘does not, by

itself, establish a claim of discrimination against

interstate commerce.’ CTS Corp. v. Dynamics Corp.

of America, 481 U.S. 69 (1987); see also Common-

wealth Edison Co. v. Montana, 453 U.S. 609 (1981);

Exxon Corp. v. Gov. of Maryland, 437 U.S. 117, 126

(1978). The strict scrutiny test does not apply in

these circumstances.”

—_——

* “The Court deems irrelevant any evidence attributing to any

state officials any motive of discriminating against interstate

20a

“The Base Fee does not facially discriminate

against out-of-state waste. All waste disposed of at

Alabama commercial hazardous waste facilities is

subject to the $25.60 fee. Consequently the Pike v.

Bruce Church balancing test will be applied to assess

the fee’s constitutional validity. In balancing the

interests at stake, the Court finds that the burden

the Base Fee imposes on interstate commerce is not

clearly excessive in relation to the benefits it pro-

duces. The fee benefits the state, on the other hand,

by compensating it for the financial responsibilities

and risks it bears on account of commercial hazard-

ous waste disposal activities. Thus, a comparison of

the Base Fee’s local benefits to its alleged burden on

interstate commerce establishes that any such bur-

den is not clearly excessive. Furthermore, to the ex-

tent that the Base Fee does deter hazardous waste

landfilling, the fee is a proper instrument of deter-

rence.* Finally, in view of the financial, safety, en-

vironmental and other objectives of Act No. 90-326

and the fact that the Base Fee falls evenhandedly on

interstate and intrastate waste, it is difficult to

imagine how these objectives could be accomplished

in ways that have a lesser impact on interstate ac-

tivities.

“For these reasons, CWM’s Commerce Clause chal-

lenge to the Base Fee is without merit.

commerce. It is well-established that ‘[i]nquiries into [law-

makers’] motives or purposes are a hazardous matter.... What

motivates one legislator to make a speech about a statute is

not necessarily what motivates scores of others to enact it, .. .’

United States v. O'Brien, 391 U.S. 367, 383-84, 88 S.Ct. 1673,

1682-88, 20 L.Ed.2d 672, 684 (1968), cited in, CECOS Inter-

national, Inc. v. Jorling, 895 F.2d 66, 73 (2d Cir. 1990).”

“Similarly, in the forms which the EPA submits in connection

with its waste reduction program, the agency asks states to

list measures they are taking to reduce the generation of waste ;

the EPA lists fees as one example of such measure.”

2la

“(2) The Equal Protection Challenge

“The Equal Protection Clause of the United States

Constitution and similar provisions of the Alabama

Constitution prohibit the State of Alabama from

denying any person equal protection of the law.

There is a ‘presumption of constitutionality which

can be overcome only by the most explicit demon-

stration that a classification is a hostile and oppres-

sive discrimination against particular persons and

classes.’ Lehnhausen v. Lake Shore Auto Parts Co..,

410 U.S. 356, 364-65 (1973). See also White v.

Reynolds Metals Co., 558 So.2d 373 (Ala. 1989).

‘The burden is on the one attacking the legislative

arrangement to negative every conceivable basis

which might support it.’ Madden v. Kentucky, 309

U.S. 83, 88 (1940). Unless the state statute in-

volves a suspect class or a fundamental right, courts

generally will not overturn the statute on equal pro-

tection grounds ‘unless the varying treatment of

different groups or persons is so unrelated to the

achievement of any combination of legitimate pur-

poses that [the court] can only conclude that the

legislature’s actions were irrational.’ Pennell v. San

Jose, 485 U.S. 1, 14 (1988) (quoting Vance v. Brad-

ley, 440 U.S. 93, 97 (1979)). The statute must be

‘rationally related to a legitimate state interest.’

Bankers Life & Casualty Co. v. Crenshaw, 486 U.S.

71, 81, 108 S.Ct. 1645, 100 L.Ed.2d 62, 74 (1988)

(quoting Cleburne v. Cleburne Living Center, 473

U.S. 432, 440 (1985)). If the state legislature’s de-

termination that its regulation will serve a legiti-

mate public purpose is ‘at least debatable,’ the chal-

lenge to that action must fail. United States v.

Carolene Products Co., 304 U.S. 144, 154 (1938).

‘|Cljourts are not empowered to second-guess the

wisdom of state policies.’ Western & Southern Life

Ins. Co. v. Board of Equalization, 451 U.S. 648, 670

(1981). This ‘rational relationship’ test is not diffi-

22a

cult to pass. Metropolitan Life Ins. Co. v. Ward, 470

U.S. 869, 881 (1985). Additionally, state regula-

tions dealing with health, welfare and the economy

are entitled to deferential Equal Protection review.

Evergreen Waste Systems, Inc. v. Metropolitan Serv-

ice District, 643 F. Supp. 127, 133 (D.Or. 1986)

(citing Hughes v. Alexandria Scrap Corp., 426 U.S.

794 (1976)); Railway Express Agency v. New York,

336 U.S. 106 (1949)). State tax legislation is given

great deference. White v. Reynolds Metals Co., 558

So.2d at 380. States are free to impose taxes on

different trades and professions, and may vary the

tax rates on different products. Jd. (quoting Allied

Stores of Ohio, Inc. v. Bowers, 358 U.S. 522, 526-27

(1959) ). Because the Base Fee provision involves

neither a susrect class, such as race, nor a funda-

mental right, such as free speech, this Court must

analyze the statute under the above-described, lenient

‘rational relationship’ test, see Exxon Corp. v. Eager-

ton, 462 U.S. 176, 195-96 (1983), asking 1) whether

the provisions have a legitimate purpose, and 2)

whether it was ‘reasonable for the lawmakers to

believe that use of the challenged classification would

promote that purpose. .. .’ Western & Southern

Life Ins. Co., 451 U.S. at 668.

“CWM argues that the Base Fee deprives it of

equal protection of the law because it only applies

to commercial hazardous waste facilities, and its

Emelle operations constitute the only such facility in

Alabama. The Court does not agree with this con-

tention. First, the Court does not agree with the

implication that CWM has somehow been ‘singled

out’ because the Base Fee, as a practical matter,

only applies to it. There is no evidence to suggest

that Act No. 90-326 will not apply to commercial

hazardous waste facilities which are sited in Ala-

bama in the future. Until that time, any regulation

of commercial hazardous waste facilities will neces-

23a

sarily fall on CWM alone. This fact, however, does

not prevent the legislature from regulating CWM’s

operations.*

“Second, the Court finds that the legislature’s

treatment of commercial hazardous waste facilities

differently from non-commercial facilities is ration-

ally related to legitimate state interests. The evi-

dence at trial established several reasons for the dif-

ferentiation. For example, the use of commercial

disposal sites poses unique health and safety risks,

such as the transportation of dangerous materials

to the sites with the risk of accidents involving such

transportation, and the accumulation in one place

of extremely large volumes of different types of

waste. The number of trucks delivering hazardous

waste to the Emelle facility alone was approximately

40,000 during 1989, and was expected to increase

in subsequent years. Hazardous waste disposal at

non-commercial facilities, however, does not involve

transportation of the materials to be disposed of,

with the dangers inherent in and unique to such

transportation. Such facilities dispose of their waste

on-site. In CECOS International, Inc. v. Jorling, 895

F.2d 66 (2d Cir. 1990), the plaintiffs argued that a

state law requiring siting board approval for the ex-

pansion of commercial, but not non-commercial, haz-

ardous waste facilities violated equal protection. The

Second Circuit rejected this argument because the

state provided several reasons for applying this re-

quirement to commercial facilities. The reasons in-

cluded the fact ‘that there are greater risks associ-

* CWM’'s claim that the legislature was motivated by improper

motivations is also irrelevant for equal protection purposes.

‘[N Jo case in this Court has held that a legislative act may

violate equal protection solely because of the motivations of

those who voted for it.” Palmer v. Thompson, 403 U.S. 217, 224,

91 S.Ct. 1940, 1944, 29 L.Ed.2d 438 (1971), cited in CECOS

International v. Jorling, supra, 895 F.2d at 73.”

24a

ated with commercial facilities because hazardous

wastes must be transported to the off-site commercial

facility.’ Id. at 73 (emphasis supplied). The State

of Alabama has offered similar reasons for the classi-

fication now before the Court.

“Moreover, commercial landfill facilities comprise

the bulk of the hazardous waste accumulation prob-

lem. The waste disposed of at commercial facilities

exceeds many times the waste disposed of on site by

non-commercial facilities. Additionally, without re-

gard to the health, safety and environmental con-

cerns, and viewing the fees simply as taxes, the legis-

lature is not precluded from taxing a commercial

transaction simply because it does not impose the tax

on a similar non-commercial activity. Many consti-

tutionally permissible tax measures treat different

taxable entities in different ways.

“Thus, CWM has failed to meet its burden of ne-

gating every conceivable basis which might support

Act No. 90-326’s differing treatment of commercial

and non-commercial facilities. White v. Reynolds

Metals Co., supra. The differentiation serves a

legitimate purpose and it was reasonable for the

legislature to believe that the classification promotes

that purpose. This Court, therefore, must defer to

the legislature’s classification of these two types of

facilities.

“(3) The Due Process Challenge

“Article I, section 6 of the Alabama Constitution

states, among other things, that no accused in a crim-

inal prosecution shall be deprived of life, liberty, or

property except by due process of law. This right

has been extended to civil trials. Ross Neely Ex-

press, Inc. v. Alabama Dep't. of Environmental Man-

agement, 437 So.2d 82, 84 (Ala. 1983). In order to

avoid violating the Due Process Clause of the Ale-

25a

bama Constitution, a legislative classification must

be reasonable and not arbitrary. White v. Associated

Industries of Alabama, Inc., 373 So.2d 616, 617 (Ala.

1979).

“The Base Fee is reasonable in function. It pro-

vides some financial assurance against the risks

associated with materials posing a permanent threat

to health, safety and the environment. The burden

imposed is not an excessively heavy one. While

CWM’s right to maximize profits is certainly im-

portant, it does not by any stretch of the imagina-

tion outweigh the state’s interest in protecting the

health and safety of its citizens and environment.

Under any kind of ‘rational and reasonable’ analysis,

therefore, the Base Fee is clearly valid.

Il.

Next we must consider whether the trial court erred

in holding that the Cap provision of Act No. 90-326 is

constitutional and is not preempted by federal statautes.®

We find the reasoning and the conclusions of law by the

trial judge to be persuasive on this issue. We therefore

adopt Judge Phelp’s order of February 28, 1991, as to

the issue of the Cap provision, as the decision of this

Court:

“THE CAP PROVISION

“(1) The Commerce Clause Challlenge

“The Court now turns to the question of whether

the ‘Cap’ provision violates the Commerce Clause.

This provision states that no commercia] hazardous

waste disposal facility which takes in more than

5(1) the Resource Conservation and Recovery Act (“RCRA”),

42 U.S.C. § 6901 et seq.; (2) the Toxic Substances Control Act

(“TSCA”), 15 U.S.C. § 2601 et seq.; (3) the Comprehensive Environ-

mental Response Compensation and Liability Act (“CERCLA”), 42

U.S.C. § 9601 et seq.

26a

100,000 tons of hazardous waste annually may dis-

pose of more waste in the year starting October 1,

1991 than it disposed of during the statutory bench-

mark period, regardless of the origin of the waste.

The position of CWM would allow it, and not the

Alabama legislature, to determine what volume of

hazardous waste will be buried permanently in the

state. CWM insists that_the Cap provision, like the

fees, is an impermissible legislative interference with

its rights to dispose of and to bury in Alabama what-

ever volume of such waste that it wishes. This Court

disagrees, and concludes that the Cap provision is no

more violative of the Commerce Clause than the Base

Fee, and for many of the same reasons.

“The Cap provision applies equally to in-state and

out-of-state waste. Accordingly, the Pike v. Bruce

Church balancing test must be utilized to assess its

validity under the Commerce Clause. Like the Base

Fee, the Court finds that the Cap provision regulates

evenhandedly to effectuate a legitimate local interest.

Tonnage restrictions which apply equally to all

waste, regardless of origin, do not violate the Com-

merce Clause. Wetzel County Solid Waste Authority

v. West Va. Div. of Natural Resources, 401 S.E.2d

227 (W.Va. 1990). The state has a clear and legiti-

mate interest in conserving its natural resources—

the Seima chalk and the Eutaw acquifer—and in

protecting the health and safety of its citizens. The

state also has a legitimate interest in protecting the

environment surrounding the Selma chalk and the

Eutaw aquifer and in extending the life of the land-

fill for the benefit of in-state and out-of-state waste

generators. The Cap provision promotes this interest

without discrimination by limiting the amount of

waste that can be disposed of at Emelle during any

12-month period. See County of Washington v.

Casella Waste Management, Inc., 1999 WL 208709

27a

(N.D.N.Y. Dec. 6, 1990) (stating that local law

prohibiting all out-of-county solid waste served a

legitimate local purpose in protecting public health

and safety as well as the environment, and noting

that one of the legitimate effects of the local law

might be to extend the useful life of safe landfills) ;

and Bill Kettlewell Excavating, Ine. v. Michigan

Dept. of Natural Resources, 732 F.Supp. 761 (E.D.

Mich. 1990) (holding that statute requiring county

approval for disposal of out-of-county solid waste

served legitimate purpose of extending lives of the

county’s landfills). The Cap provision also furthers

Alabama’s legitimate interest in controlling health

and safety risks by, in effect, regulating the amount

of waste being transported on the state’s highways

and te its landfills. The Court again notes that land-

filling is the least desirable form of waste disposal

as it peses a perpetual threat to the ground and sur-

face waters in the landfill’s vicinity and to the sur-

rounding environment. The Cap provision necessar-

ily encourages the development of new technologies

to supplement and minimize hazardous waste land-

filling.

“Finally, any burden which the Cap provision

might place on interstate commerce is speculative.

The Cap limits the amount of waste in successive

years only to that amount landfilled during the 1990-

91 benchmark period. . .. Thus, the Cap ereates no

discriminatory burden on existing levels of commerce

or on existing rates of waste generation and land-

filling. The Cap provision permits increased volumes

if such is warranted in accord with safety or to

comply with State or federal regulations.* Thus, the

* “The Court notes that the Cap provision contains the following

language: ‘Provided, however, that the Governor or the Gov-

ernor’s designee may allow disposal of hazardous wastes or

hazardous substances in excess of the tonnage disposed of during

28a

Cap provision merely furthers the policy that future

growth in the amounts of such waste to be disposed

of must be accompanied by growth in the develop-

ment and use of safer and more environmentally

sound methods of disposal. (See § 9 of Act 90-326).

“(2) The Supremacy Clause Challenge

“CWM alleges that the Cap provision comes into

conflict with three federal statutes: The Resource

Conservation and Recovery Act (‘RCRA’), 42

U.S.C.A. § 6901 et seq., which governs treatment and

disposal of solid waste, the Toxic Substances Control

Act (“TSCA’), 15 U.S.C.A. § 2602 et seq., which reg-

ulates the disposal of toxic wastes such as PCBs, and

the Comprehensive Environmental Response Compen-

sation, and Liability Act (‘CERCLA’), 42 U.S.C.A.

$9601 et seqg., which provides federal funding for

cleanup of hazardous and toxic substances. CWM’s

Emelle facility operates under permits issued in ac-

cordance with these federal statutes, and CWM ar-

gues that the Cap provision directly conflicts with

either the provisions or the goals of all three. The

Court disagrees, and will treat each statute in turn.

“(a) The Cap Provision Does Not Conflict With,

Frustrate, or Impede the Operation of RCRA.

“RCRA, as amended in 1983, is a ‘cradle to grave’

reculatory program which sets standards for the

generation, treatment, storage, and disposal of

hazardous waste. RCRA is designed to promote sev-

eral goals with regard to hazardous waste: 1) as-

the benchmark period if such action is determined by the Gov-

ernor or the Governor’s designee to be necessary to protect

human health or the environment in the state, or to allow the

State to comply with its obligations to assure disposal capacity

pursuant to applicable state or federal law as determined by

the Governor or his designee.’ Act 90-326, § 9.”

29a

suring that hazardous waste management is con-

ducted in a way that protects human health and the

environment; 2) requiring that hazardous waste be

properly managed from the outside; and 3) mini-

mizing the generation of hazardous waste and the

landfilling of hazardous waste by encouraging process

~ Substitution, materials recovery, recycling, and treat-

ment. 42 U.S.C.A. § 6902 (b).

“RCRA demonstrates a strong policy against land-

filing. In the congressional findings accompanying

the 1983 amendments, Congress found that ‘reliance

on land disposal should be minimized or eliminated,

and land disposal, particularly Jandfill and surface

impoundment, should be the least-favored method for

managing hazardous wastes. ...’ 42 U.S.C.A. § 6910

(b) (7). Congress also maintained that alternatives

to land disposal ‘must be developed.’ Jd. at § 901

(b) (8). The floor debates which preceded the pas-

sage of the amendments repeatedly emphasized con-

cerns about the dangers of landfill disposal. Con--

gresswoman Schneider stated that the bill required a

‘direct economic disincentive for the land disposal of

hazardous waste,’ and advocted supplementing the

measure with ‘economic incentives that encourage al-

ternatives to land disposal.’ 29 CONG. REC. pt 17

(1983), p. 23164. Congressman Walgren argued,

“In my view, our society should seriously ques-

tion the continued land disposal of hazardous

wastes. If we can find ways to dispose or neu-

tralize hazardous waste instead of dumping it in

the ground, we should. Ground disposal is in-

herently dangerous because subsequent contam-

ination of liners in landfills can be penetrated

with underground water. There are other ways

to dispose of wastes that we should turn to... ”’

Id. at p. 23168. Congressman Frenzel similarly

stated, ‘continued reliance on land disposal of haz-

30a

ardous wastes is a dangerous policy which threatens

the health of Americans now and in the future.’

Id. at p. 23161.

“In light of these concerns, this Court finds that

the Cap provision is consistent with what the Con-

gress had in mind when passing _,RCRA—reducing

the amount of landfilled waste—and furthers, rather

than frustrates the purpose of RCRA. The Cap pro-

vision is a mechanism which will encourage gener-

ators to find ways other than landfilling to dispose

of their hazardous wastes, and this is exactly what

Congress emphasized in RCRA.

“Further, RCRA directly addresses the question of

federal ‘state supremacy. Section 6929 states that no

state may impose treatment and disposal require

ments less stringent than those prescribed in RCRA,

and further states, ‘Nothing in this chapter shall be

construed to prohibit any state . . . from imposing

any requirements, including those for site selection,

which are more stringent than those imposed by such

reculations.’ RCRA sets a floor, a minimum level of

regulation by which all states must abide. State ac-

tions or regulations which go above that floor—

which are more stringent than RCRA—are expressly

permitted. The Cap provision, being more stringent

than the requirements of RCRA, is clearly permis-

sible. In short, there is no indicatign that the Cap

provision conflicts with or impedes the operation of

RCRA in any way.

“(b) The Cap Provision Does Not Conflict With,

Frustrate, or Impede the Operation of TSCA.

“TSCA regulates the handling of toxic chemical

substances and mixtures in an attempt to promote

the promulgation of adequate data concerning the

risks involved with such substances. In particular,

3la

Congress wishes through TSCA to encourage techno-

logical innovation, while at the same time ensuring

that such innovation did not ‘present an unreasonable

risk of injury’ to health or the environment.’ 15

U.S.C.A. § 2601(b) (3). Again, in light of this

policy, the Court finds that the Cap provision, ane

effect of which will be to encourage the development

of alternative disposal technologies while minimizing

the amount of waste landfilled, does not ‘stand as an

obstacle to the accomplishment and execution of the

full purposes and objectives of Congress in enacting

TSCA,’ as CWM claims. In light of express congres-

sional policy discouraging and disfavoring the prac-

tice of burying such highly dangerous mate. ials in

the ground, the Court cannot conceive that Congress,

in enacting TSCA, intended to grant landfill oper-

ators a right to bury unlimited amounts of such

materials. Nor does the Court find that such un-

limited burial is necessary to the implementation of

that Act.

“(e) The Cap Provision Does Not Conflict With,

Frustrate, or Impede the Operation of

CERCLA.

“(T]he primary purpose of CERCLA is the

prompt cleanup of hazardous waste sites.’ State of

Alabama +. United States Environmental Protection

Agency, 871 F.2d at 1557-58 (quoting Dickerson v.

Administrator, EPA, 834 F.2d 974, 978 (11th Cir.

1987) ). CERCLA allows the Administrator to prom-

ulgate regulations involving substances. which,

when released, could cause harm to the environment.

42 U.S.C.A. § 9602(a). It requires anyone who has

knowledge of the release of such a substance greater

than a designated amount to notify the United States

government. 42 U.S.C.A. § 9603. Whenever such a

release occurs, CERCLA authorizes the President to

32a

remove the substance and/or provide for remedial

action, or to take any other response ‘consistent with

the national contingency plan.’ 42 U.S.C.A. § 9604

(a). Aleng with 26 U.S.C.A. § 9507, CERCLA es-

tablishes a trust fund, commonly known as ‘Super-

fund,’ to be used to pay costs incurred by the govern-

ment in providing this help. 42 U.S.C.A. § 9611.

- “CWM argues that the Fee Act’s Cap provision

artificially requires the Emelle facility to withhold

capacity that otherwise would be available imme-

diately for the disposal of waste generated at Super-

fund cleanup sites located outside of the State of

Alabama, and that the provision ‘undermines Con-

gress’s goal of making the best use of existing waste

treatment and disposal facilities in the short term.

CWM’s argument is based on the assumption that

Alabama has the burden under CERCLA of meeting

the capacity assurance requirements of other states.

This Court does not agree. CERCLA places the ca-

pacity assurance burden on the state generating the

waste, not on the state importing it. Alabama is not

required to provide enough capacity to dispose of all

of the waste generated in the United States during

the next twenty years; it has to assure the President

only that it can provide capacity to dispose of its own

waste during that period.

“Again, CWM is aruging that a statute designed

to protect and promote health, safety and environ-

mental quality indirectly evidences a congressional

policy which directly conflicts with the express con-

gressional policy against landfilling. CWM _ would

have the Court construe CERCLA as being incon-

sistent with the policy clearly stated in another con-

gressional enactment addressing the same general

environmental quality concerns. This Court cannot

find that Congress, in providing for clean-up of the

results of past unsound waste disposal practices, in-

38a

tended to imply a policy conflicting with its expressly

stated condemnation of reliance on landfilling.

“(3) The Due Process Challenge

“Economic and social legislation, such as that in-

volved herein, falls under the substantive component

of the Due Process Clause, and the standard for

evaluating its validity is virtually identical to the

Equal Protection ‘rational relationship’ test. In re

Wood, 866 F.2d 1867, 1371 (11th Cir. 1989).

“*|Economie and social legislation] generally

will be upheld against a substantive due process

attack unless the legislation “manifests a pat-

ently arbitrary classification, utterly lacking in

rational justification.” Fleming v. Nestor, 363

U.S. 603, 611... (1960). As with the “rational

relationship” test, any plausible reason support-

ing Congress’ action in enacting the suspect leg-

islation satisfies the “rational basis” test. Jd. at

612, 80 S.Ct. at 1373.’

Id, (emphasis in the original). This Court’s analysis

of CWM’s Due Process challenge to the Cap provi-

sion, therefore, is very similar to its analysis of

CWM’s Equal Protection claims.

“CWM contends that the Cap provision ‘arbitrarily

and irrationally’ deprives it of its property interest

in the Emelie facility in violation of the Due Process

Clause. However, where, as here, restrictions on

waste disposal are related to the state’s goal of pre-

serving and managing landfill space and in protect-

ing the health and safety of its citizens, such re-

strictions do not violate due process. Bill Kettlewell

Evcavating, Ine. v. Michigan Dept. of Natural Re-

sources, 732 F.Supp. 761, 765 (E.D. Mich. -1990).

Moreover, the state’s reasons for treating hazardous

waste buried in commercial facilities differently from

34a

industrial wase buried on site are rational and are

not arbitrary. The Cap provision is rationally re-

lated to reducing the transportation and accumula-

tion of hazardous waste and similar dangerous sub-

stances in the state. When such a rational basis for

“a statute exists, it does not violate the Due Process

Clause.

“(4) The Contracts Clause Challenge

“Article I, section 10 of the federal Constitution

makes it unlawful for states to impair the obliga-

tions of contracts. Although debtor relief laws were

the primary focus of the Contracts Clause, Keystone

Bituminous Coal Ass’n v. DeBenedictis, 480 U.S.

470, 502-503 (1987), the Clause has since been ap-

plied to other kinds of laws, including state laws

that have the incidental effect of altering contractual

obligations. See Allied Structural Steel Co. v. Span-

naus, 438 U.S. 234 (1978). A state statute does not

violate the Contracts Clause ‘simply because it has

the effect of restricting, or even barring altogether,

the performance of duties created by contracts en-

tered into prior to its enactment.’ Exxon Corp. v.

Eagerton, 462 U.S. at 190. Rather, a court analyz-

ing a Contracts Clause claim must employ a balanc-

ing test.

“First, the court must determine whether the

state law has in fact substantially impaired the con-

tractual relationship. Spannaus, 438 U.S. at 244.

“*The severity of the impairment measures the

height of the hurdle the state legislation must

clear. Minimal alteration of contractual obliga-

tions may end the inquiry at its first stage.

Severe impairment, on the other hand, wil! push

the inquiry to a careful examination of the na-

ture and purpose of the state legislation.’

35a

Id, at 245. Second, if the law does substantially im-

pair the contractual rights, the state must show that

the law was designed to promote a legitimate public

purpose, such as remedying a general social or eco-

nomic problem. Energy Reserves Group v. Kansas

Power and Light Co., 459 U.S. 400, 411-412 (1983).

Finally, if the statute is shown to have a legitimate

public purpose, the state must show that the law is

based on reasonable conditions and that it is of a

character appropriate to the public purpose. Home

Building & Loan Ass’n v. Blaisdell, 290-U.S. 398,

445-47 (1934). In making this determination, courts

defer to the legislative judgment if the regulation

invloved is social or economic. United States Trust

Co. v. New Jersey, 431 U.S. 1, 22-23 (1977).

“Applying the above analysis, the conclusion is

clear that the Cap provision does not violate the Con-

tracts Clause. First, CWM has made no showing

that the Cap provision has impaired its existing con-

tracts. Second, even had CWM presented some proof

that the Cap provision impaired its existing con-

tracts, it is clear that the law was designed to pro-

mote a legitimate public purpose. Finally, as dis-

cussed above, the Cap provision is based on reason-

able conditions: it allows CWM and the out-of-state

generators to determine the cap amount. Moreover,

it is of a character to promote the public purpose-—

it will prevent the amount of hazardous waste buried

in the state from increasing in subsequent years.

All three elements of the test balance in favor of the

Cap provision.

“(5) The Takings Clause Challenge

“Under the Fifth Amendment to the United States

Constitution, government is prohibited from taking

private property for public use without just compen-

sation. The question to be answered in determining

36a

whether the Takings Clause has been violated is

whether the governmental action amounts to a ‘tak-

ing’ requiring compensation. Pennsylvania Coal Co.

v. Mahon, 260 U.S. 393, 413 (1922). To make this

determination, a court must determine 1) whether

there is a property interest involved, see, e.g., An-

drus v. Allard, 44 U.S. 51, 65-66 (1979); and 2)

whether that property interest has been diminished—

in a case like the present one, whether there has been .-

a diminution in the economic viability of the property

by the state regulation, see Keystone Bituminous

Coal Ass’n v. DeBenedictis, 480 U.S. at 485-86, or

whether state infringement of the private property

right was done in the legitimate exercise of Police

Power or to advance a legitimate state interest and

whether the infringement operates to further state

interest and whether the infringement operates to

further that interest, see id.; Agins v. City of

Tiburon, 447 U.S. 255, 260 (1980). If the result

of this analysis indicates that there has in fact been

a taking, the remedy is generally payment of just

compensation. See Nollan v. California Coastal

Comm’n, 483 U.S. 825, 841-42 (1987).

“The Cap provision has not affected a ‘taking’

within the meaning of the Takings Clause. This

Court has already established several times over the

fact that the Cap provision—indeed, the Fee Act as

a whole—advances legitimate state interests. It is

equally clear that the Cap provision has not made

it commercially impracticable for CWM to continue

operating its Emelle facility. CWM still owns the

Emelle facility in its entirety. Its use has not been

changed or restricted; it is still a commercial haz-

ardous waste disposal facility. Comparing, then, ‘the

value that has been taken from the property with

the value that remains in the property,’ DeBene-

dictis, 480 U.S. at 497, the Court concludes that

37a

even if some diminution in value has occurred, it by

no means would constitute a taking requiring com-

pensation under the Takings Clause.”

III.

We next consider whether Act No. 90-326 is a “reve-

nue bill” enacted in violation of Article IV, § 70, of the

Alabama Constitution. We again adopt the trial court’s

order as the decision of this Court as to this issue:

“The Challenge Under § 70 of the

Alabama Constitution

“The Court finds that enactment of the Fee Act

did not violate Article IV, Section 70 of the Alabama

Constitution. Article IV, section 70 of the Alabama

Constitution provides:

“All bills for raising revenue shall originate

in the house of representatives. The governor,

auditor, and attorney general shall, before each

regular session of the legislature, prepare a

general revenue bill to be submitted to the

legislature, for its information, and the secre-

tary of state shall have printed for the use of

the legislature a sufficient number of copies of

the bill so prepared, which the governor shall

transmit to the house of representatives as soon

as organized, to be used or dealt with as that

house may elect. The senate may propose

amendments to revenue bills. No revenue bill

shall be passed during the last five days of the

session.’

CWM asserts that the Fee Act is a revenue bill

which was enacted during the last five days of the

legislative session, and that the enactment thus vio-

lated the last sentence of Article IV, section 70.

38a.

“This Court finds that the Fee Act is not a ‘reve-

nue bill’ within the meaning of section 70. In

Woco Pep Co. of Montgomery v. Butler, 225 Ala.

256, 142 So. 509 (1932), the Alabama Supreme

Court explained the meaning of the term ‘revenue

bill’ as it appears in the last sentence of section 70.

The Constitution of 1875 contained only the first

sentence of the present section 70. When the pro-

vision was rewritten for the Constitution of 1901,

the last three sentences were added, defining a ‘gen-

eral revenue bill’ and explaining how such a bill was

to be enacted. The Supreme Court considered the

added sentences in conjunction with the remarks of

the committee chairman who presented the revision

to the Constitutional Convention, and came to the

conclusion that the last sentence of section 70 ‘was

intended by the Constitution makers to apply only

to the general revenue bill.’ Id. at 511 (emphasis

added). The Court held that the fact that the Con-

stitution makers revised the penultimate sentence of

section 70 to authorize the Senate to propose amend-

ments to the general revenue bill and to amend spe-

cific bills for raising revenue only strengthened its

conclusion that the term revenue bill ‘related exclu-

sively to and affected general revenue bills.’ Id. See

also Opinion of the Justices, 270 Ala. 38, 115 So.2d

464, 467-68 (1959) ; Opinion of the Justices, 269 Ala.

676, 115 So.2d 484, 485 (1959); Opinion of the

Justices, 259 Ala. 514, 66 So.2d 921, 923 (1953);

Dorsky v. Brown, 255 Ala. 238, 51 So.2d 360, 362,

cert. denied, 342 U.S. 818 (1951). Because the Fee

Act is not a general revenue bill, but a_ specific

measure, section 70 does not apply.”

IV.

We next consider whether the trial court erred in

holding that the Additional Fee of Act No. 90-326 dis-

criminates against interstate commerce in violation of

the Commerce Clause.

39a

The Commerce Clause does not invalidate all state

restrictions on commerce. “It has long been recognized

that ‘in the absence of conflicting legislation by Congress,

there is a residuum of power in the state to make laws

governing matters of local concern which nevertheless in

some measure affect interstate commerce or even, to

some extent, regulate it.’ Southern Pacific Co. v. Arizona,

325 U.S. 761, 767, 65 S.Ct. 1515, 1519, 89 L.Ed. 1915

(1945).” Kassel v. Consolidated Freightways Corp., 450

U.S. 662, 670, 101 S.Ct. 1309, 1816, 67 L.Ed.2d 580, 586

(1981). The constitutionality of a state regulation de-

pends upon “a sensitive consideration of the weight and

nature of the state regulatory concern in light of the ex-

tent of the burden imposed on the course of interstate

commerce.” IJd., quoting Raymond Sfotor Transp., Inc.

v. Rice, 434 U.S. 429 at 441, 98 S.Ct. 787, at 794, 54

L.Ed.2d 664, at 673 (1978).

In New Energy Co. v. Limbach, 486 U.S. 269, at 278,

108 S.Ct. 1803, at 1810, 100 L.Ed.2d 302 (1988), the

United States Supreme Court stated the test in which a

facially discriminatory statute may be found to be valid

under the Commerce Clause:

“Our cases leave open the possibility that a State

may validate a statute that discriminates against

interstate commerce by showing that it advances a

legitimate local purpose that cannot be adequately

served by reasonable nondiscriminatory alternatives.

See, e.g., Maine v. Taylor, 477 U.S. at 138, 151, 106

S.Ct., at 2447, 2455; Sporhase v. Nebraska ex rel.

Douglas, 455 U.S. at 958; Hughes v. Oklahoma, 441

1.S., at 336-337, 99 S.Ct. at 1736; Dean Milk Co. v.

Madison, 340 U.S., at 354, 71 S.Ct., at 297. This is

perhaps just another way of saying that what may

appear to be a ‘discriminatory’ provision in the con-

stitutionally prohibited sense—that is, a protectionist

enactment—may on closer analysis not be so. How-

ever it be put, the standards for such justification

40a

are high. Cf. Philadelphia v. New Jersey, 437 U.S.

617, 624, 98 S. Ct. 2531, 2585, 57 L.Ed.2d 475

(1978) (‘where simple economic protectionism is ef-

fected by state legislation, a virtually per se rule of

invalidity has been erected’) ; Hughes v. Oklahoma,

441 U.S., at 337, 99 S. Ct., at 1737 (‘{F ]acial dis-

crimination by itself may be a fatal defect’ and ‘Lat

a minimum .. . invokes the strictest serutiny’).”

In holding that the Additional Fee violates the Com-

merce Clause, the trial judge relied upon City of Phila-

delphia v. New Jersey, 437 U.S. 617 (1978), and Na-

tional Solid Wastes Management Ass’n v. Alabama Dep't

of Environmental Management, 910 F.2d 713 (11th Cir.

1990), modified and reh’g denied, 924 F.2d 1001 (11th

Cir. 1991), reh’g en bane denied, —— F.2d —— (April

15, 1991) ; cert. denied, U.S. ‘ S.Ct.

(1991) [59 U.S.L.W., 3821, 3823, 3783 (June 10, 1991)

(No. 90-1718) ].

In National Solid Wastes Management Ass’n the 11th

Circuit Court of Appeals held the “Holley Bill,” Act No.

89-788, Code of Ala. 1975, § 22-30-11 ( Supp. 1990), in-

valid under the Commerce Clause. The Holley Bill

banned disposal of hazardous waste in Alabama from a

number of states. The Court of Appeals stated:

“Alabama’s selective ban on out-of-state hazard-

ous waste is no quarantine law. Alabama did not

ban hazardous wastes from all other states on the

ground that the wastes were dangerous to some hu-

man health or environment aspect which Alabama

has a right to regulate. Alabama’s ban does not dis-

tinguish on the basis of type of waste or degree of

dangerousness, but on the basis of the state of gen-

eration.”

Id., 910 F.2d at 721. Unlike the Holley bill, the Addi-

tional Fee provision of Act No, 90-326 has specifically

been found by the legislature to be an effective way to

4la

deal with health and environmental hazards to Alabam-

ians created by hazardous waste imported here from

other states. We believe that Alabama has a legitimate

local interest which this Act legitimately serves, and is

one that is permissible under the Commerce Clause.

The Supreme Court of the United States has not said

that hazardous waste is an article of commerce. Assum-

ing that it is an article of commerce, as the 11th Circuit

Court of Appeals assumed, we believe that a statute such

as the one before us, which advances a legitimate local

purpose that cannot be adequately served by reasonable

nondiscriminatory alternatives, can be valid under the

Commerce Clause.

The trial court concluded that City of Philadelphia v.

New Jersey, supra, compelled the conclusion that the leg-

islation involved here was foreclosed by the Commerce

Clause. We believe that that case is distinguishable under

the facts here. That case involved a New Jersey statute

that banned the movement of liquid or solid waste (but

not hazardous waste) into the state. The purpose of that

legislation was found to be economie protectionism, which

was in violation of the Commerce Clause. CWM argues

that the holding in City of Philadelphia v. New Jersey

precludes state and local governments from responding

to real and substantial public health and environmental

dangers by controlling the importation of wastes. How-

ever, the United States Supreme Court cases make a dis-

tinction between state measures that discriminate arbi-

trarily against out-of-state commerce in order to give

in-state interests a commercial advantage, i.e., simple

economic protectionism, and state measures that seek to

protect public health or safety or the environment.

Maine v. Taylor, 477 U.S. 131, 148 n. 19 (1986).

In City of Philadelphia v. New Jersey, the Supreme

Court made this distinction and decided that the New

Jersey statute constituted economic protectionism, rather

than a measure to protect the citizens of the state from

42a

menaces to their health or safety. City of Philadelphia

v. New Jersey does not hold that a state may not limit

importation of wastes to protect health and the environ-

ment; it holds that a state may not do so for “simple

economic protectionism.” The Supreme Court has char-

acterized City of Philadelphia v. New Jersey as involv-

ing “a state law purporting to -promote environmental

purposes” but is “in reality ‘simple economic protection-

ism.’” Minnesota v. Clover Leaf Creamery Co., 449 U.S.

456, 471 (1981).

Mr. Justice Rehnquist, in his dissent in City of Phila-

delphia v. New Jersey, discussed the growing problem

in our nation in the disposal of solid waste and the health

and safety hazards associated with its disposal. There,

in speaking not of hazardous waste, as in the present

case, but of garbage, he noted that the United States

Supreme Court has recognized that the States can enact

quarantine laws, which “have not been considered for-

bidden protectionist measures, even though they were

directed against out-of-state commerce.” Jd., 437 U.S.

at 631 (quoting the majority opinion, 437 U.S. at 628).

Justice Rehnquist stated:

“The Court recognizes, ante [437 U.S. at 621-

624], that States can prohibit the importation of

items, ‘which, on account of their existing condition,

would bring in and spread disease, pestilence, and

death, such as rags or other substances infected

with the germs of yellow fever or the virus of small-

pox, or cattle or meat or other provisions that are

diseased or decayed, or otherwise, from their condi-

tion and quality, unfit for human use or consump-

tion.’ ”

437 U.S. at 631. (Citations omitted.) Justice Rehnquist

considered the quarantine law cases dispositive of the

issue, and would have allowed a state to regulate solid

wastes from out-of-state.

43a

In Maine v. Taylor, 477 U.S. 131 (1986), the United

States Supreme Court made it clear that environmental

measures are entitled to greater deference than ordinary

legislative acts. The Court upheld a facially discrimina-

tory state statute that banned all importation of live

baitfish. The Court stated:

“The Commerce Clause significantly limits the

ability of States and localities to regulate or other-

wise burden the flow of interstate commerce, but it

does not elevate free trade above all other values. As

long as a State does not needlessly obstruct interstate

trade or attempt to ‘place itself in a position of eco-

nomic isolation,’ ... it retains broad regulatory au-

thority to protect the health and safety of its citizens

and the integrity of its natural resources. The evi-

dence in this case amply supports the District

Court’s findings that Maine’s ban on the importa-

tion of live baitfish serves legitimate local purposes

that could not adequately be served by available non-

discriminatory alternatives. This is not a case of

arbitrary discrimination against interstate com-

merce; the record suggests that Maine has legitimate

reasons ‘apart from their origin, to treat |[out-of-

state baitfish] differently ....’”

477 U.S. at 151-52.

The Supreme Court in Maine v. Taylor cited City of

Philadelphia v. New Jersey for the proposition that

“{s|hieiding in-state industries from out-of-state com-

petition is almost never a legitimate local purpose, and

state laws that amount to ‘simple economic protectionism’

consequently have been subject to a ‘virtually per se rule

of invalidity,” while stating that, in contrast to City

of Philadelphia v. New Jersey, “there is little reason in

this case to believe that the legitimate justifications the

State has put forward for its statute are merely a sham

or a ‘post hoc rationalization.’” Maine v. Taylor, 477

U.S. at 148-49.

44a

The Additional Fee provision in the Act advances a

legitimate local purpose that cannot be adequately served

by reasonable nondiscriminatory alternatives. It has not

been enacted for the purpose of economic protectionism.

In enacting the Additional Fee, the Alabama legislature

was not banning the collection and acceptance of hazard-

ous waste; it was merely asking the states that are using

Alabama as a dumping ground for their hazardous

wastes to bear some of the costs for the increased risk

they bring to the environment and the health and safety

of the people of Alabama. As in Maine v. Taylor, the

problem is already with us. Millions of tons of hazardous

wastes have been buried at Emelle. The State of Ala-

bama has a legitimate justification, apart from their

origin, for treating the out-of-state wastes differently.

Because this waste is permanently stored in Alabama,

the risk to the health and safety of the people of Ala-

bama will continue in perpetuity. The costs to the state

of regulation and monitoring of the facility will continue

in perpetuity. A disproportionate share of these costs

will be borne by the taxpayers of the State of Alabama

for the wastes dumped by other states.

The Additional Fee serves these legitimate local pur-

poses that cannot be adequately served by reasonable non-

discriminatory alternatives: (1) protection of the health

and safety of the citizens of Alabama from toxie sub-

stances; (2) conservation of the environment and the

state’s natural resources; (3) provision for compensatory

revenue for the costs and burdens that out-of-state waste

generators impose by dumping their hazardous waste in

Alabama; (4) reduction of the overall flow of wastes

traveling on the state’s highways, which flow creates a

great risk to the health and safety of the state’s citizens.

The testimony before the trial court showed that in

1985 some 341,000 tons of hazardous waste were buried

in the Emelle facility. By 1989 the tonnage had grown

to 788,000 tons per year. While CWM estimates that

45a

there is capacity for storage at Emelle for 100 years,

the increase in tonnage has more than doubled in four

years.

As the trial judge noted in his findings of fact:

“It is without dispute that the waste and sub-

stances being landfilled at the Emelle facility include

substances that are inherently dangerous to human

health and safety and to the environment. Such

waste consists of ignitable, corrosive, toxic and re-

active wastes which contain poisonous and cancer-

causing chemicals and which can cause birth defects,

genetic damage, blindness, crippling and death.

Should a sudden or non-sudden discharge or release

occur, hazardous wastes could pollute the environ-

ment, contaminate drinking water supplies, contam-

inate the ground water, and enter the food chain.

Among these are arsenic, mercury, lead, chromium

and cyanide. These wastes are generated by an en-

tire spectrum of industry.”

Unlike the situation in City of Philadelphia v. New

Jersey, where there was questionable environmental con-

cern, there is legitimate concern here in Alabama. There

is no dispute that the wastes dumped at Emelle include

known carcinogens and materials that are extremely

hazardous and can cause birth defects, genetic damage,

blindness, crippling, and death. These wastes are far

more dangerous to the people of Alabama than rags in-

fected with small-pox or yellow fever.

This Court takes judicial notice of the fact that there

is a finite capacity for storage of hazardous waste at the

Emelle facility and that the capacity is rapidly being

reached. The record reflects that 85% to 90% of the

tonnage that is permanently buried at Emelle is from

out-of-state. There is nothing in the Commerce Clause

that compels the State of Alabama to yield its total ca-

pacity for hazardous waste disposal to other states. To

tax Alabama-generated hazardous waste at the same rate

46a

as out-of-state waste is not an available non-discrimina-

tory alternative, because Alabama is bearing a grossly

disproportionate share of the burdens of hazardous waste

disposal for the entire country. Here, the statute that

creates the Additional Fee does not needlessly obstruct

interstate trade, nor does it constitute economic protec-

tionism. It is a responsible exercise by the State of Ala-

bama of its broad regulatory authority to protect the

health and safety of its citizens and the integrity of its

natural resources.

The Commerce Clause is designed to promote national

unity and discourage economic protectionism. However,

as previously stated, statutes that are facially discrimina-

tory can survive the strict strutiny of Commerce Clause

analysis. In Northeast Bancorp, Inc. v. Board of Gov-

ernors of the Federal Reserve System, 472 U.S. 159

(1985), the Supreme Court examined Massachusetts and

Connecticut statutes forbidding banks outside the New

England region from taking over in-state banks, while

allowing New England banks to do so. The Court held

that this was a legitimate state purpose.

For the reasons stated above, we hold that the Addi-

tional Fee provision of Act No. 90-326 is not invalid un-

der the Commerce Clause of the United States Constitu-

tion. The Additional Fee does not needlessly obstruct

interstate trade or attempt to place Alabama in a posi-

tion of economic isolation. It merely retains Alabama’s

broad regulatory authority to protect the health and

safety of its citizens and the integrity of its natural

resources. The evidence in this case amply supports the

conclusion that the Additional Fee serves legitimate local

purposes that could not adequately be served by available

nondiscriminatory alternatives. This is not a case of ar-

bitrary discrimination against interstate commerce; the

record suggests that Alabama has legitimate reasons,

apart from their origin, to treat out-of-state wastes dif-

ferently. The judgment of the trial court is therefore

reversed as to this issue.

47a

The final issue before the Court is whether the trial

court erred in holding that Governor Hunt had standing

to raise the issue of the constitutionality of the Cap pro-

vision. CWM contends that the complaint it filed chal-

lenged the constitutionality of the Base Fee and the Addi-

tional Fee. Governor Hunt filed a counterclaim, seeking

to have the trial court declare the Cap provision consti-

tutional. CWM argues that the Governor lacked standing

to raise that issue and cites Casey v. Travelers Ins. Co.,

531 So.2d 846, 849 (Ala. 1988), wherein this Court

stated: “ ‘Where a particular litigant is not within the

group of persons effected by the statute or portion

thereof which is allegedly unconstitutional, such litigant

lacks standing to raise such constitutional issue’ ”

(Quoting Fletcher v. Tuscaloosa Federal Savings & Loan

Ass’n, 294 Ala. 173, 178, 314 So.2d 51, 56 (1975).)

We find CWM’s challenge to Governor Hunt’s standing

to be without merit. The Governor’s counterclaim was

filed only after CWM had sued him in a United States

District Court, alleging that the Cap provision violated

CWM’s federally protected rights. Further, the trial

court’s jurisdiction over the question of the validity of

the Cap provision was expressly invoked in CWM’s orig-

inal complaint alleging the invalidity of the entire Act.

Thus, there existed a justiciable controversy that Gov-

ernor Hunt, as a state official, had standing to raise in

a counterclaim for a declaratory judgment. Curry v.

Woodstock Slag Corp., 242 Ala. 379, 6 So.2d 479 (1942).

For the reasons stated above, the judgment of the trial

court is due to be affirmed as to all issues save the Addi-

tional Fee and reversed and the cause remanded as to

the issue of the Additional Fee.

AFFIRMED IN PART; REVERSED IN PART;

AND REMANDED.

Hornshy, C. J., and Maddox, Almon, Adams, Steagall,

and Ingram, JJ., concur.

Houston, J., concurs in the judgment.

48a

HOUSTON, JUSTICE (concurring in the judgment).

Until the United States Supreme Court holds that haz-

ardous waste (waste that the trial court found contained

poisonous chemicals that can cause cancer, birth defects,

genetic damage, blindness, crippling, and death) is an

article of commerce protected by the Commerce Clause of

the United States Constitution, I refuse to declare the

additional fee provision of Act No. 90-326, which was

duly enacted by the Alabama Legislature and approved

by the Governor of Alabama, unconstitutional as viola-

tive of the Commerce Clause of the United States Con-

stitution.

If the United States Supreme Court holds that waste

containing poisonous chemicals that can cause cancer,

birth defects, genetic damage, blindness, crippling, and

death is an article of commerce protected by the Com-

merce Clause of the Constitution, then I am bound by

that ruling under the Supremacy Clause of Article VI

of the United States Constitution. Alabama lost that

battle over 125 years ago; however, I do not believe that

such waste is an article of commerce protected by the

Commerce Clause, and I do not believe that the Alabama

Supreme Court is bound by the decision of any other

federal court on this issue. United States ex rel. Law-

rence v. Woods, 432 F.2d 1072 (7th Cir. 1970), cert. de-

nied sub nom. Lawrence v. Woods, 402 U.S. 983, 91 S.Ct.

1658, 29 L.Ed.2d 148 (1971).

I can appreciate how Judge Phelps, a distinguished

trial judge, could feel compelled to comply with a legal

precedent of the 11th Circuit Court of Appeals, in the

absence of an opinion on that point by this Court; how-

ever, “‘there is a parallelism but not paramountey’”

between the 11th Circuit Court of Appeals and this

Court, “ ‘for both ... courts are governed by the same

reviewing authority of the [United States] Supreme

49a

’ 99

Court. United States ex rel. Lawrence v. Woods, 432

f.2d at 1075, quoting the Supreme Court of New Jersey

in State v. Coleman, 46 N.J. 16, 214 A.2d 393, 403

(1965), cert. denied, 383 U.S. 950, 86 S.Ct. 1210, 16

L..ed.2d 212 (1966).

50a

APPENDIX B

IN THE CIRCUIT COURT

OF MONTGOMERY COUNTY, ALABAMA

Civil Action No. CV 90-1098

CHEMICAL WASTE MANAGEMENT, INC., PLAINTIFF

Vv.

THE ALABAMA DEPT. OF REVENUE; JAMES M. SIZEMORE,

JR., as Commissioner of the ALABAMA DEPARTMENT OF

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